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India's gold giant says tax shakeup will underpin spurt in sales
[MUMBAI] Titan Co, India's largest maker of branded jewelry by market value, expects sales from its Tanishq stores to increase about 30 per cent this fiscal year as the country's biggest tax overhaul in decades helps to attract more customers and the company expands its network.
"We are going to get more aggressive" as the new measures to boost financial transparency favor the company, Sandeep Kulhalli, senior vice president for retail and marketing at the jewelry arm of Tata Group, said in an interview. The company plans to add 25 to 30 franchisee stores a year in India, and it's also exploring setting up shops in Dubai and Singapore, he said.
Titan has become the top pick among Indian jewelers after the government implemented the uniform goods and services tax last month, as well as introducing additional measures to increase financial accountability and clamp down on so-called black money. The stock has surged 86 per cent this year to a record, valuing the company at about 539 billion rupees (S$11.4 billion). Asia's third-largest economy vies with China as the world's largest gold consumer.
"Now there is a more level playing field," said Mr Kulhalli, speaking on the sidelines of an industry conference in Goa at the weekend. Customers who earlier shied away from Titan because of higher prices and favored the financial flexibility offered by smaller jewelers, will now shift to branded stores because of their trustworthiness, he said.
The company - which has about 224 stores nationwide - plans to open more outlets in the north, west and east, targeting smaller towns, Mr Kulhalli said. "India is blessed with consumers who still have a strong affinity to gold and diamonds and the social fabric is still around weddings," he said. "As long as these factors remain, consumption in India will not be an issue."