Timex Group India Ltd
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BSE Code:
500414
NSE Code:
TIMEX
Business Profile
Business Profile
Timex Watches Limited (TWL) was incorporated in 1988. It is a joint venture between Timex Corp, USA and Titan Industries, where both the partners hold 30 per cent equity. India is the only country, where Timex Corp has set up a joint venture with a local partner. TWL is the second largest manufacturer in organised quartz watch sector in India. TWL targets the younger generation with its focus on informal sporty watches in the price range of Rs 300 to Rs 1000. At present, TWL controls 23 per cent of the market in the organised sector. The company owns showrooms to sell its products exclusively. It also has franchisee arrangements with some dealers.
In FY99, TWL manufactured 1.4 million watches. At present the company is an important vendor of precision injection moulding toolings to Timex Corp. In the same year, TWL reported a drop of eight per cent in total income after it assumed responsibility for marketing sales and services of its products, which was initially with Titan Industries.
Timex, USA plans to buy out Titan`s stake in TWL. This deal will enable Timex to gain majority control over TWL.
Recent Developments
Timex Watches BV (USA) acquired 4.5 million shares of TWL on preferential basis at a price of Rs.24.25 per share. After the acquisition, Timex Watches BV, along with its associate company owns 36.78 per cent of the total outstanding shares of TWL. Titan Industries Ltd (TIL), which holds 28.79 per cent share in TWL, has already agreed to sell its entire stake to Timex Watches BV. The inflow of capital will allow the company to reduce its reliance on external borrowings, reduce its interest expense and lower its debt-equity ratio. The parent company, Timex, will also introduce its full range of watches in India after it gets the majority holding and operational control in India.
Future Plans
TWL also plans to launch its new data-linked and pager watch in India soon. The data-linked watch can store 150, four-line addresses. It is the only watch in the world that has the ability to update itself directly from a personal computer monitor without any interface. The company has decided to tap smaller towns with its value-for-money plank, offering watches in the range of Rs 540 to Rs 1,500. At present, it has its presence in 1,200 towns and is sold in 5,500 retail outlets in the country. TWL plans to invest around Rs. 20 mn on expanding its retailing. The company has also earmarked Rs. 90 mn for ad spend, during FY01, which accounts around 10 per cent of the turnover.
As a global policy, the company has decided to focus on 400 styles, which will be maintained for two years and, which will then be completely replaced by new introductions. The company has around 540 models and it hopes to whittle this down to 400. The company hopes to achieve a market share of 30 per cent this year and have a leading market share in around three years` time. It is also building up its after-sales network. At present, it has four company-owned service centres in Noida, Mumbai, Calcutta, Chennai and Bangalore.