Buy Titan Company; target of Rs 1400: Motilal Oswal
Motilal Oswal is bullish on Titan Company recommended buy rating on the stock with a target price of Rs 1400 in its research report dated October 28, 2020.
November 02, 2020 / 12:52 PM IST
Motilal Oswal's research report on Titan Company
Titan's (TTAN) jewellery segment's (adjusting for one-off bullion sales) recovery of 98% is remarkable. The first 10 days of the festive season, even when compared to the corresponding (non-COVID) period last year, shows single-digit YoY growth. This, along with likely bunching up of wedding dates in 3QFY21, offers hope that recovery to normalcy may actually take place (compared to continued guidance for 4QFY21). However, we are still assuming 2% jewelry sales decline in 3QFY21 as (a) jewelry sales growth base was higher in 3QFY20 compared to 2QFY20, and (b) unfavorable gold price movements could affect near-term demand.
While FY22E multiples at 55x may appear expensive, it is primarily due to temporary impact of the pandemic in FY21, from which the rebound would be sharp over the next couple of years. Maintain Buy with TP of INR1,400 (55x Sep'22 EPS).
For all recommendations report, click here
Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.