Due to the government’s move of lowering the transaction threshold of quoting PAN from Rs. 5 lakhs to Rs. 2 lakhs, the jewellery and watches giant Titan Co.hopes to take a hit of up to Rs.500 crore this financial year.
The Managing Director of Titan Co., BhaskarBhat, said, “We would have of around Rs. 400 crore to Rs. 500 crore effect on our turnover. This would be loss of turnover. This is our estimate.” The company has already taken a hit due to the previous limit ofRs. 5 lakh, he added.
The company stated last month that the government’s move could impact the cash sales of jewellery items between Rs. 2 lakh and Rs. 5 lakh. Reiterating the fact that the company has not resorted to means to circumvent the rule by breaking up bill, Bhat said, “We are suffering on account of that. We do not break up bill as one lakh, one lakh and then sell.”
In order to curb the generation of black money, the Finance Ministry had lowered the purchase limit for quoting PAN from Rs. 5 lakh to Rs. 2 lakh in December last year.
Titan Co had reported revenue of Rs. 11,903.21 crore in the financial year 2014-15. The jewellery constitutes around 73 per cent of the revenue of Titan Co., 25 per cent is from watches and the rest is from eye-wear and precision engineering segment.
Speaking about the effect of the government’s move, Bhat said, “People are buying; luxury segment and premium segment is growing. However, the mass market has got affected.”