It’s been a long day for Bhaskar Bhat, Managing Director, Titan Co. It’s also been a big day as it’s the launch of a new line of business for the watches to jewellery maker.

Perfumes is a new line of business for Titan, but Bhat expects the marketing machine it is to make a success of its Skinn brand.

Spotting underserved categories is where the opportunity lies, he says, in an interview to Business Line over a Spartan lunch after a series of interviews for TV. Excerpts:

Why did Titan feel the need to change its corporate identity?

The name has stood us well. But looking at the next 25 years, we did an international survey as to what we should stand for. We also worked on what’s next for Titan, on its business, vision and mission; we thought it was a good time to even revisit the company name. So we did everything together. We also wanted to separate the brand Titan, which is in watches and jewellery, and the company name. But the entire employee community as well as the businesses wanted the name of the company to be Titan. So, we tried to retain the name, but at the same time differentiate it. We developed a new symbol for the company but the logos will be the same for brands like Titan watches, Tanishq, Fastrack. The motive was to navigate the next Titan, the company, not the brand.

Is there any fundamental change at the company level because of this?

You have to look at companies in a 10- to 25-year milestone and not every year. So if you do a check, in the last 25 years we have completely changed. We are not just a single product company or a manufacturing company. We have become four different industries. We have become the largest retailer. Manufacturing has become less intense but still high in the precision business. The proportion of employees in our retail business is almost equal to our manufacturing. So, all these things make a difference to the company.

The name change is just cosmetic but it is also a style change. We have not shunned manufacturing; we have respected, enhanced and differentiated it. In jewellery, we are manufacturing everything in-house. In each business we have progressed differently. For example, in eyewear, we make our own lenses but not frames; we are still importing them. We are setting up a new unit for watch cases in Coimbatore (investment of Rs 100 crore) and a big precision engineering plant in Hosur for Rs 150 crore.

What is the total capex going to be this year?

Around Rs 400 crore, this includes manufacturing, expansion of retail stores, and also a frame manufacturing plant (in Chikaballapur at Rs 25 crore). Besides, we will be investing another Rs 150 crore for a new corporate office in Electronics City, Bangalore, from the present one next year.

When are you planning to relaunch Fabre Leuba (Swiss brand bought last year)?

In April next year. It will be manufactured in Switzerland. There will be no investment in manufacturing. The money has gone into buying the brand for Rs 9.5 crore. We will, however, be investing Rs 100 crore in making the brand successful. It will be mostly for India, Switzerland and other select markets.

You had a bad experience in the European market earlier and it took you six years to write off the losses. Are you positive about that market now?

No, we are not looking at any pan-European launch now. We were present in that market with watches. We are now mostly in South Asia. We sell a million watches outside and 40 million in India. Rs 2,500 crore is our revenue from the watch business and about Rs 150 crore, i.e. less than 10 per cent, comes from international markets, which is a profitable business.

You have entered so many categories? What will be your focus going ahead?

The idea is to unearth more and more underserved categories. The Indian middle-class today has access to hundreds of products, which is 20 times more than what they had 30 years back. People have the required disposable income .

Which are the categories you want to enter?

Helmets, is one (under Fastrack). You just look around yourself to see how many branded products you have. There are still many categories in India, which are age old and there are no (big) manufacturers. They may not be a Rs 2,000-crore market but we bring value. What is wrong in creating a Rs 500-crore brand, it doesn’t cost much. We invested just Rs 50 crore for our perfume brand Skinn (and expect to earn Rs 250 crore from the brand in three years)

How do you see the festival season?

I am very optimistic. There was negativity among retailers in the first four to five months with growth and same store sales lesser than last year. People cut down on discretionary spends during such times. We will move to single digit positive, but it won’t be dramatic. We are confident of growing 20 per cent topline. I can give a better estimate after Diwali. It’s one of the biggest parameters to judge consumer sentiment.

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