Titan FY04 net soars 80% to Rs 11.1 cr

The Rs 900 crore Titan Industries Ltd is on track to bring the much needed parity to its debt equity ratio. The company is on a debt restructuring initiative backed by strong growth in sales and net profit.

The company for FY04 has managed to reduce its aggregate borrowing from Rs 467 crore as at March 31, 2003, to Rs 407 crore on March 31, 2004.

According to a spokesperson for the company, this has been achieved as a result of compression in working capital.

The spokesperson further added, "In addition, a major part of the surplus cash inflow from operations was deployed towards debt reduction. Although net profit was higher than last year by 80 per cent, dividend payout has remained at 10 per cent.

The company had posted a 80 per cent increase in its net profit to Rs 11.1 crore for the year ended March 31, 2004, as compared to Rs 6.2 crore for the year ended March 31, 2003. Total income (net of excise) had increased from Rs 746.3 crore in FY03 to Rs 896.9 crore in the year ended March 31, 2004.

Commenting on the strategy, the company will be adopting for the current year, he said, "The strategy would be similar for the current year. However, one must remember that it is very difficult to continue indefinitely with such asset compression in a scenario of growing sales - and that at double-digit percentage rates - so the quantum of debt reduction in the current year is likely to be less than in 2003-04."

During FY04, Titan had made provision for diminution in value of investments of Rs 10 crore and also for doubtful loans and advances of Rs 15 crore in its European subsidiary.

According to a statement from the company, both the watch as well as the jewellery divisions have recorded significant increases in their sales and profits for 2003-04. The watch division's income grew by 18 per cent, going up from Rs 453.89 crore in the previous year to Rs 534.49 crore.

The jewellery division's sales increased from Rs 345.13 crore to Rs 425.68 crore, an increase of 23 per cent. The company's exports rose sharply, going up from Rs 51.64 crore to Rs 80.99 crore, an increase of 57 per cent.