That growth was due in part to weak comparable sales last year, when a nationwide jewellers’ strike in March and April over a new excise duty shut down the sector. As such, the figures for this year’s first quarter — which ended June 30 — looked more favourable, the company pointed out.
The new goods and services tax (GST), which went into effect July 1, will likely work to the advantage of organized jewellers such as Titan, the retailer explained. Titan has promised to compensate its franchise partners for losses arising from the 3% levy on gold and jewellery. Meanwhile, the company reported a “seamless” switch to compliance with the new regime. “We believe [GST] should not create any disruption in sales [or in] gold exchange,” it said.
Watch sales have also been unaffected so far, despite the new 28% tax on sales of timepieces. However, the company did postpone two of its promotional events due to tax-related uncertainties and their potential impact on the business. Timepiece prices are unlikely to rise, but the tax will likely increase the risk of watch-smuggling into the country, Titan warned.
The company, India’s largest jewellery retailer, operates more than 1,200 stores across the country, including 160 under the Tanishq brand.