Prabhudas Lilladher's research report on Titan Company
We retain Accumulate on TTAN as steady recovery across Jewellery, watches and Eyewear is sustaining in October. We believe improving consumer sentiments, higher walk-ins with improved conversion rates and ticket sizes, robust e-com watches sales and better product mix in eyewear division are positives. Jewellery division is expected to be back to growth in 3Q on back of festival and wedding demand though coin sales will be high like 2Q due to investment demand. However, watches and eyewear division will improve QoQ, but still with 15-25% de-growth in sales. TTAN’s long term structural story remains intact on account of market share gains, strong balance sheet, franchisee based model, strong brand, and strong head start in executing strategies like customer safety and Omni Channel across product segments.
Outlook
We estimate 18.8% PAT CAGR over FY20-23 and value the stock at 46xFY23 EPS and assign a target price of Rs1352. Retain Accumulate.
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