Titan to scale down operations of watch brand Favre Leuba
Tata group firm Titan Company Ltd is planning to downsize the operations of its wholly-owned subsidiary Favre Leuba AG (FLAG), with immediate effect.
Titan, in a regulatory filing to the stock exchange, said that Covid-19 has severely disrupted the revival plans and prospects of the Swiss watch brand in the country, resulting in downsizing of the business.
“The board of Titan at its meeting held today has decided to request the FLAG management to scale down the operations of the company substantially with immediate effect so that further investments from Titan to FLAG cease as early as possible,” the company stated in the filing.
“Consequently, this will lead to Titan making provisions in the current financial year for additional impairment pertaining to its investments in FLAG, in addition to the impairment of Rs 145 crore ($19.8 million) already made in earlier years,” it added.
The company, however, did not give specific details as to how it plans to scale down the FLAG operations in the country.
The scaling down of FLAG is the second big announcement made by the company in the watches segment. Titan Ltd had earlier informed that it will end its five-year joint venture association with luxury firm Montblanc in December this year.
The watches and wearables business is the second highest contributor to the company’s revenue after jewellery and had recorded revenue of Rs 400 crore in the second quarter of the current financial year.
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