ICICI Direct is bullish on Titan Company has recommended buy rating on the stock with a target price of Rs 1290 in its research report dated May 09, 2019.
ICICI Direct's research report on Titan Company
Titan reported a healthy set of Q4FY19 numbers, driven by sustained robust performance for the jewellery division. However, various one-offs in the quarter, impacted profitability. Revenues grew 19% YoY to Rs 4888.8 crore led by robust revenue growth of 22% in the jewellery division despite muted growth witnessed in the industry. Adjusting for exceptional expenses, EBITDA margins improved marginally by 20 bps YoY to 10.8%. The company has fully provided for the Rs 145 crore inter corporate deposits in the IL&FS group (Rs 46 crore provided in Q4FY19). Further, the company has made an ex-gratia payment to its employees to the tune of Rs 34.0 crore. Following the same, PAT grew 13.7% YoY to Rs 348.2 crore.
We model revenue and earnings CAGR of 20% and 29%, respectively, in FY19-21E. We reiterate our BUY rating on stock with a target price of Rs 1290 (49.0x FY21E EPS).
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