Titan India

Hyderabad Franchise India News: Watch and jewellery maker Titan Co. Ltd will set up its second spectacle-lens manufacturing facility in northern or eastern part of India in the coming fiscal year, a top executive said.

The new factory will be strategically located to take benefit of geographical advantage, S. Ravi Kant, chief executive officer of the eyewear business at Titan, said on Thursday.

The only Titan lens manufacturing facility is located in the southern part of the country, and the new unit will make logistics management easier as the country’s largest eyewear brand opens new showrooms.

The company is also “evaluating” a proposal to manufacture spectacle frames domestically, Kant said without disclosing a time frame. He also refused to divulge the investment size for the second lens manufacturing plant.

Titan produces specialized lenses at its facility in Chikkaballapur near Bangalore.The unit, which has the capacity to produce 0.5 million lenses a year, operates round the clock and is fast reaching 100% utilization capacity, Kant said. The company invested Rs15 crore in the Bangalore unit in 2010.

“I don’t know if there are fiscal benefits coming from North India and East India. It depends on how their eyewear business is placed geographically,” Abhijeet Kundu, vice president of research at Antique Stock Broking, said over phone. The second facility could also help reduce the exposure of the eyewear business to constant currency fluctuations, Kundu said. But the contribution of the eyewear business to Titan’s revenues is still small, and the impact of constant currency fluctuations was visible primarily in watches segment, he pointed out.

The company imports 100% of its spectacle frames from China, Korea, Italy, and imports around 50% of lenses from France, the UK and Korea among other countries.

A weak rupee and frequent currency fluctuations are having a “very bad impact” on the business, Kant said, pointing out that the rupee was around Rs48 to a dollar when Titan ventured into the eyewear market in 2007.

Titan which makes lenses under Titan Advantage and Ace brands, also sells the lenses of Essilor, Kodak and Nikon, which are imported. Single power lenses, which have uniform power across the lenses, are also imported, while high-end RX lenses, which incorporate characteristics like cylindrical power, anti-humidity, water and dust repellent properties, are made in Bangalore.

Currency values of some of the countries Titan imports from have also strengthened putting further strain on the input costs, Kant said. But so far, the company has absorbed the cost impact and has kept its product prices steady. “We’d like to sell more and reach out to more customers,” said Kant.

The company will also open 50-60 Titan Eye Plus stores, majority of them in the franchise business format, in 2014-15, Kant said. It currently has 278 stores in 106 cities across the country; about 80 of them are company-owned.

“They have been aggressive in setting up stores. But it is still a reasonable target given the current (macro-economic) scenario,” said Kundu. Consumers have begun to tighten their purses on discretionary spending in the face of a weak economy.



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