Hold Titan Company; target of Rs 936: Prabhudas Lilladher

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26 Aug, 2025 12:21

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We are increasing FY21 and FY22 EPS estimates by 1.0% and 6.0% following 1) 80% sales recovery in jewellery sales in operational Tanishq stores 2) Likely benefits of Omni channel strategy across Jewellery, watches and eyewear 3) significant cost cutting in rent and overheads 4) aggressive plans to gain market share (35% new customers) given stress amongst other organized jewellers. We believe TTAN has distinct advantage over competitors given strong balance sheet (Raised Rs10bn 3 month CP at 4.22%), franchisee based model, strong brand, economies of scale and strong head start in executing strategies like customer safety and Omni Channel across product segments. Although 1H will show significant pressure on sales and profitability,

TTAN is expected to emerge stronger post this COVID led shakeout across categories like Jewellery, Watches, Eyewear and emerging segments like Fragrances and Sarees. We value the stock at 45xFY22 EPS and arrive at a target price of Rs936 (Rs844, based on 43xFY22 EPS earlier). We retain HOLD and recommendation addition on declines for long term gains.

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