Sharekhan's research report on Titan Company
Sustenance of good demand momentum and improved footfalls in jewellery aided Titan’s consolidated revenues to grow by 18% (ex-bullion sales) to Rs. 8,567 crore with EBIDTA margins improving by 69 bps to 13.6% and PAT growing by 30% y-o-y to Rs. 835 crore. Jewellery business grew by 18% while watches business grew by 20% in Q2. Eyecare business registered muted sales growth of ~4%. Jewellery business revenues would grow at 20% with higher ticket-size sales, expansion in stores and market share gains; EBIT margins of the jewellery business to sustain at 12-13%. Watches business would see consistent double-digit growth with EBIT margins of 13-14% while eyecare business would deliver mid-teen margins. Stock is currently trading at 71.4x/61.3x its FY2023/24E earnings.
Outlook
We retain our Buy recommendation on the stock with an unchanged PT of Rs. 3,140.
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