Timex's CEO called OEM a core pillar. Then he said it wasn't.
Deepak Chhabra contradicted himself on OEM's strategic role within the same earnings call, even as the company posts record ₹800 cr revenue.
What's new
- FY24 revenue hit ₹800 crore, a 48% YoY jump, with EBITDA margin expanding to 14.5% from 9.2%.
- E-commerce grew 90% and now makes up 40% of the business.
- Company targets 200-300 retail stores in 2-3 years, up from 45-50 now.
Themes from the call
Demand
All core brands grew 48-62%, with the analog watch market accelerating to 13-13.5% growth.
Margins
FY25 EBITDA margin guided at 15-16% as the company prioritizes top-line investment over margin percentage.
Capital allocation
Manufacturing capacity is being tripled to 15 million units at the Baddi plant, with each assembly line costing ₹60-65 lakhs.
Guidance watch
- FY25 EBITDA margin guided at 15-16%, with a strategic shift to targeting ₹400-500 crore in absolute EBITDA.
- Retail expansion to 200-300 stores from 45-50 within 2-3 years.
- DTC channel to grow from 2% to 15-17% of the business mix.
Risk flags
- The OEM contradiction raises questions about how stable the stated long-term strategy really is.
- A 10-12% price hike was implemented in May 2025; volume resilience post-increase is unproven.
- Inventory levels rose to ₹197 crore from ₹150 crore, though inventory turns improved to 2.67x.
Key quotes
-
"Within three to four years, we may contend for the number-one spot globally."
— Deepak Chhabra, Managing Director -
"OEM is not a strategic pillar where we have 100% control, so we exclude it from our core long-term planning."
— Deepak Chhabra, Managing Director
The brief
Deepak Chhabra delivered a stellar set of numbers for Timex Group India. Revenue crossed ₹800 crore for the first time, up 48%, with EBITDA margins expanding meaningfully. The core brands are firing, e-commerce is booming, and management's ambition to rival Titan is palpable. India is now the fastest-growing market for the global group, and Chhabra sees a path to the top spot globally within four years.
The credibility of that ambition, however, took a self-inflicted hit. Early in the call, Chhabra identified the OEM business as a core pillar alongside the key brands. Later, he reversed course, saying OEM is 'not a strategic pillar' and is excluded from long-term planning. The contradiction was not addressed. While OEM grew 43% and adds a per-unit fee stream, the flip-flop is the kind of messaging inconsistency that makes investors question the precision of forward guidance.
That guidance is now focused on absolute numbers rather than margins. The company is targeting ₹400-500 crore in absolute EBITDA and a retail footprint of 200-300 stores. This is a deliberate pivot from percentage-based metrics. The risk is that a 10-12% price increase, implemented in May to offset input costs, is untested in the market. Management sounds confident, but the OEM confusion suggests the internal strategy map may be less clear than the top-line growth suggests.
The numbers are strong. The messaging on what matters for the long term is not.