Investors might remember the questionable premium brand positionings, diversifications into the jewellery business with long gestation periods, huge capital investments with a reducing capability to utilise these funds productively and the consequent high cost of funds, all of which had eroded Titan's profitability in the past.

But the company truly seems to have put all this behind, with a strong half yearly performance for the six months ended September 1998. Thanks in no small measure to a strong second quarter where net profits stood at Rs 8.63 crore, compared toa first quarter loss of Rs 0.92 crore. Thus, Titan has clocked a net profit of Rs 7.71 crore compared to a negative earnings growth in previous years. More importantly, this was achieved despite a dip in the other income component and a higher wage burden. Stringent working capital management and a reduction in inventory levels, also obviously helped Titan buoy its bottomline.

But this aside, the company's performance on the operational front has also been impressive, despite the margins still being pressurised. Sales have improved 10.83 per cent from Rs 185.43 crore to Rs 205.51 crore. Thanks largely to a volume growth in domestic watch sales, aided to some extent by Titan's recent re-entry into the low-priced segments with the Sonata and Fastrack brands. Analysts state that jewellery sales have also displayed a positive growth trend after the company shifted from 18 carat to 22 carat gold jewellery.

But perhaps more important, for Titan has been the journey of re-discovering its niche. Titan seems tohave realised its blunder with the "elitist" positioning of its Tansihq jewellery range and has undertaken steps to push the Tanishq brand to a wider target audience, in a bid to try and develop mass appeal. The company is also said to have adopted a similar strategy in the watch segment, a move which is clearly inspired by the success of the company's low-priced offerings namely Sonata and Fastrack in the domestic markets. The development of an analog watch for the lower end of the spectrum is also a move along the same lines. All of which reveal, that learning from its mistakes, Titan has indeed come a full circle.

Telco

Perhaps, Telco was on the only stock among the pivotals which failed to close higher on Wednesday, the day on which the vehicles pricing was to finally be made public. The short-term outlook for the stock is not very promising as all the positive factors that have taken place in the recent past have been fully discounted by the market. In fact, the pricing factor has also beenthe stocks main driver. In a best case scenario, the car is expected to be priced at Rs 2.70 lakh, given which the stock should remain firm. But major gains from the current levels are not expected as punters who have taken long position at lower levels would like to book profit. But anything above Rs 3 lakh would be bad for the stock price and the stock can dip to Rs 160.

ITC turns bullish

It was ITC that provided a major boost to the market on Wednesday and helped the Sensex to cross 3,100-mark. The stock touched the maximum upper limit at Rs 775, which was incidently a 7-month high. The factor to which the rally can be attributed is the rumour of a bonus issue. These rumours could have some base as the last time the company gave a bonus issue was in 1994 and has a strong book value.

With the latest move, the technical position of ITC has strengthened and puts it into a new bull oribit. The stock has faced resistance at Rs 731 and Rs 741 levels respectively. Huge jump in volumes also favours apositive trend. The move above these levels is nothing but a pointer toward a medium term bull phase. The next resistance for the stock is placed at Rs 830.