Synopsis:
The shares of Titan are in focus after CITI, Morgan Stanley, and CLSA have given their viewpoints on the company’s performance in the future.
The shares of this Tata Group-backed company are in focus after the company announced its first quarter updates and caught the attention of brokerages’ interest in it. In this article, we will dive deep into the details.
With a market capitalisation of Rs 3,06,184 crores, the shares of Titan Company Ltd are currently trading at Rs 3,449 per share, down by 11 percent from its 52-week high of Rs 3,866.15 per share. Over the past five years, the stock has delivered a return of 258 percent.
Multiple brokerages have several viewpoints, which we will discuss below.
Brokerage firm CITI has maintained a “neutral” rating on the company with a target price of Rs 3,800 per share, signifying an upside potential of 10 percent from its current level.
It cited that Titan’s jewellery business, excluding bullion, grew by 17 percent. This increase happened because people spent more on each purchase, even though the number of buyers remained constant.
Plain gold jewellery performed well, while studded jewellery also grew but at a slower rate, leading to a slight drop in its share. CaratLane experienced a significant 38 percent rise in sales.
Brokerage firm CLSA has maintained an “outperform” rating on the company with a target price of Rs 4,326 per share, signifying an upside potential of 25.42 percent from its current level.
Titan reported a 20% increase in consumer business growth, which is slightly below CLSA’s estimate of 22.8%. Jewellery sales grew by 18%, driven by CaratLane’s 38% increase and a 17% rise in Tanishq, Mia, and Zoya.
Watches saw a 25% growth, and international business skyrocketed by 49%. CLSA described the overall growth as strong, even with high gold prices and global tensions.
Brokerage firm Morgan Stanley has maintained an “overweight” rating on the company with a target price of Rs 3,876 per share, signifying an upside potential of 12.38 percent from its current level. It cited that the June quarter was a big miss for the jewellery business, and the buyer growth was flat.
Financial Highlights
The company reported a revenue of Rs 60,456 crores in FY25, down by 18.35 percent from its FY24 revenue of Rs 51,084 crores. However, the company reported a net profit decrease of 4.57 percent to Rs 3,337 crore in FY25 from Rs 3,496 crore in FY24.
The stock delivered an ROE and ROCE of 31.75 percent and 19.14 percent respectively, and is currently trading at a high P/E of 91.75x as compared to its industry average of 32x.
Titan Company Limited is a top lifestyle brand in India. It works in watches, jewellery, eyewear, and accessories. Key brands include Tanishq, Mia, Zoya, and CaratLane for jewellery; Titan, Fastrack, Sonata, Raga, and Nebula for watches; Titan Eye+ and Fastrack Eyewear for eyecare; and Taneira for ethnic wear.
The company also offers perfumes under SKINN and bags under Fastrack and IRTH. Titan sells through retail stores and online platforms, both in India and abroad.
Written by Satyajeet Mukherjee
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