Titan Company on Monday (7 December 2020) said that its board has decided to scale down the operations of its wholly-owned subsidiary, Favre Leuba AG (FLAG), with immediate effect.
FLAG is a wholly owned subsidiary of Titan Company and was incorporated in 2012. The company is headquartered in Solothurn, Switzerland and owns the Favre Leuba brands, one of the oldest Swiss watch brands.Titan has invested approximately Rs 275 crore over a period of time for reviving the Favre Leuba brand. However, the current Covid-19 pandemic has severely impacted these revival plans and prospects.
Accordingly the Titan's board at its meeting held on Monday (7 December) decided to request the FLAG management to scale down its operations substantially with immediate effect so that further investments from Titan to FLAG cease as early as possible. Consequently, this will lead to Titan making provisions in the current financial year for additional impairment pertaining to its investments in FLAG, in addition to the impairment of Rs 145 crore already made in earlier years.
Titan Company is engaged in making and selling watches, jewellery, eyewear and others. The company's retail chain (including CaratLane) stands at 1,832 stores, as on 30 September 2020 with a retail area crossing 2.4 million sq ft for all its brands covering 290 towns.
On a standalone basis, the company's net profit declined 37.8% to Rs 199 crore on 11% fall in net sales to Rs 3892 crore in Q2 September 2020 over Q2 September 2019.
Shares of Titan Company were up 0.21% at Rs 1428.25 on BSE.
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