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A c q u i s i t i o n t o a i d s e g m e n t m a r g i n e x p a n s i o n …
Titan Industries (Titan) has signed a binding agreement with Spain’s
Valfamily SL and Switzerland’s Maison Favre Leuba SA to acquire the
‘Favre Leuba’ brand of watches for a consideration of up to €2 million
(| 13.6 crore). The acquisition will be completed over the next two to
three months. It will give Titan the global rights to the trademarks of the
brand. The product portfolio of the brand consists of premium watches,
which will complement and strengthen the existing portfolio. We believe
this move will aid the company to expand the segmental operating
margin as the share of premium watches increases.
In line with company’s strategy…
Titan currently enjoys a dominant 47% share (by value) of the organised
watches segment. With rising disposable incomes and increasing brand
awareness, the premium watch category has been among the fastest
growing segment and accounts for ~15% of the | 4,000 crore organised
watch market in India.
Titan is set to acquire the Swiss watch brand ‘Favre Leuba’ as a part of its
strategic business plan to expand the product portfolio. The brand ‘Favre
Leuba’ was created way back in 1737 in Switzerland. It has about 10–15
models and has been dormant globally over the last few years. Titan
plans to revive the brand in India as well as other markets and the
strategy (in terms of positioning and pricing) will be worked on shortly.
This move will help the company to expand its presence in the high
growth premium watches segment.
V a l u a t i o n
This acquisition is in line with the company’s strategy to expand its
premium watches segment by offering newer products to consumers.
The recently launched (July 2011) High Tech Self-Energised (HTSE)
collection of watches has also received an encouraging response. At the
CMP, the stock is trading at 31.8x and 27.0x its FY12E and FY13E EPS,
respectively. We have a BUY rating on the stock with a target price of |
235 (30x FY13E EPS of | 7.8).
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
A c q u i s i t i o n t o a i d s e g m e n t m a r g i n e x p a n s i o n …
Titan Industries (Titan) has signed a binding agreement with Spain’s
Valfamily SL and Switzerland’s Maison Favre Leuba SA to acquire the
‘Favre Leuba’ brand of watches for a consideration of up to €2 million
(| 13.6 crore). The acquisition will be completed over the next two to
three months. It will give Titan the global rights to the trademarks of the
brand. The product portfolio of the brand consists of premium watches,
which will complement and strengthen the existing portfolio. We believe
this move will aid the company to expand the segmental operating
margin as the share of premium watches increases.
In line with company’s strategy…
Titan currently enjoys a dominant 47% share (by value) of the organised
watches segment. With rising disposable incomes and increasing brand
awareness, the premium watch category has been among the fastest
growing segment and accounts for ~15% of the | 4,000 crore organised
watch market in India.
Titan is set to acquire the Swiss watch brand ‘Favre Leuba’ as a part of its
strategic business plan to expand the product portfolio. The brand ‘Favre
Leuba’ was created way back in 1737 in Switzerland. It has about 10–15
models and has been dormant globally over the last few years. Titan
plans to revive the brand in India as well as other markets and the
strategy (in terms of positioning and pricing) will be worked on shortly.
This move will help the company to expand its presence in the high
growth premium watches segment.
V a l u a t i o n
This acquisition is in line with the company’s strategy to expand its
premium watches segment by offering newer products to consumers.
The recently launched (July 2011) High Tech Self-Energised (HTSE)
collection of watches has also received an encouraging response. At the
CMP, the stock is trading at 31.8x and 27.0x its FY12E and FY13E EPS,
respectively. We have a BUY rating on the stock with a target price of |
235 (30x FY13E EPS of | 7.8).
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