Tata Group-owned Titan Co Ltd reported a surprise fall in third-quarter profit on Thursday as high inflation hurt demand for jewellery and watches, sending the company’s shares down to an over six-month low.
Shares of Titan, which also sells eyewear and owns the Tanishq jewellery brand, fell as much as 3.3% to 2,269.60 rupees in late afternoon trading.
Titan’s profit fell 3.7% to 9.51 billion rupees ($115.8 million) in the three months ended Dec. 31, from 9.87 billion rupees a year earlier.
Analysts, on average, were expecting Titan’s profit to rise to 10.35 billion rupees, according to Refinitiv IBES data.
Revenue grew 11.3% to 104.44 billion rupees.
Revenue from the jewellery business, which accounted for 90% of the total, grew 14.1%, while profit in the segment dipped.
A rise in gold prices has led to a 3% fall in consumption in India, the world’s second-biggest bullion buyer, the World Gold Council said in a report on Tuesday.
Elevated retail inflation levels further hit the rural sector, which usually constitutes for two-thirds of gold sales.
Bullion demand is usually high in India around festivals – a large number of which are in the early part of October-December quarter – when buying gold is considered auspicious. However, this period saw fewer wedding dates last year.