One of the Tata Group stocks in leadership positions in the watches, Jewellery, and eyewear categories has plunged by around 2 percent after announcing the weak quarterly results of September 2024, and Jefferies and Goldman Sachs have cut the target price as well.
Stock Movement:
After announcing its quarterly results, Titan Company Limited’s share has plunged by 1.64 percent. The stock opened at Rs. 3,154.95 and is currently trading at Rs. 3,180, with a high of Rs. 3,203 and a low of Rs. 3,113.65. The market capitalization now stands at approximately Rs. 2,83,021.79 crore.
Reason for Falls:
Jefferies has reduced its target price for Titan Company to ₹3,400 from ₹3,600 after disappointing Q2 results. The brokerage highlighted concerns over moderating urban consumption and elevated competition in the jewellery sector. Jefferies also adjusted the company’s earnings per share (EPS) estimates down by 3-7% and maintained a “HOLD” rating.
Goldman Sachs has also cut its target price for Titan from Rs. 3,750 to Rs. 3,650. Despite the downgrade, Goldman Sachs retains a “BUY” rating, projecting an adjusted jewellery EBIT margin of 11% for FY25, down from 12% previously.
Q2 FY25 Result Walkthrough:
Titan Company Limited’s revenue from operations has increased by 25.82 percent YOY, from Rs. 10,708 crore in Q2 FY24 to Rs. 13,473 crore in Q2 FY25, and is up by 10.23 percent QoQ from Rs. 298.85 crore in Q1 FY25.
Titan Company Limited’s net profit has decreased by 23.14 percent YOY, from Rs. 916 crore in Q2 FY24 to Rs. 704 crore in Q2 FY25. As compared to the last quarters, the company’s net profit is down by 1.54 percent QoQ from Rs. 715 crore.
The company’s EPS has decreased by 22.99 percent from Rs. 10.31 in Q2 FY24 to Rs. 7.94 in Q2 FY25.
In terms of return ratios, Titan Company Limited’s share ROE and ROCE are currently at 32.9 percent and 22.7 percent, respectively. Titan Company Limited has a debt-to-equity ratio of 2.22x.
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Shareholding Pattern:
Titan Company Limited has a majority stake held by the promoters at 52.90 percent, foreign institutional investors at 18.23 percent, domestic institutional investors at 11.28 percent, the government at 0.19 percent, and the public at 17.23 percent as of September 2024.
Tata Group Stocks has a majority holding stake in Titan Company Limited, which includes Tata Sons Private Limited at 20.84 percent, Tata Investment Corporation Limited at 2.01 percent, and Tata Chemicals Limited at 1.56 percent.
Company Overview:
Titan Company Limited stands as India’s leading lifestyle brand, specializing in watches, jewelry, and eyewear retail segments. The company dominates India’s organized jewelry market through its flagship brand Tanishq, alongside other successful brands. The company has a diverse portfolio, including popular watch brands like Titan, Fastrack, and Sonata, serving different consumer segments.
Titan Company Limited operates primarily in India with some presence in Hong Kong. Titan has built a strong retail network through franchising and distribution services. The jewelry segment contributes the largest share of company revenue, followed by watches and wearables. Titan continues to expand its lifestyle offerings through newer ventures in fragrances, Indian dress wear, and accessories.
Written by – Nikhil Naik
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