Titan Company Share Price : After the quarterly business data came out, Titan Company, which is called a multibagger stock, is seeing selling today. In today’s trading, the stock of Titan Company has weakened by about 4 percent to Rs 3126. Whereas on last Friday it closed at Rs 3269. Actually, the company’s jewellery segment (Tanishq)‘s growth has been weaker than expected. Consumer demand has been affected due to high gold prices and short wedding season. After the June quarter update, brokerage opinions on the company’s stock are also mixed.
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JP Morgan downgraded ratings and target
Brokerage house JP Morgan has downgraded the rating on Titan to “neutral”, while earlier it had an “overweight” rating on the stock. The brokerage has also reduced the target price from Rs 3850 to Rs 3450. JP Morgan said that although the fluctuations in high gold prices are affecting short-term demand, the brokerage is more concerned about the slow growth of studded jewelery amid growing consumer preference for gold and increasing promotional activities, which may hamper the pace of new customer acquisition for Titan.
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Antique Broking gave Buy rating
Brokerage house Antique Broking has given investment advice on Titan and has given a target price of Rs 4490. The brokerage says that due to weakness in the jewelery segment, the company’s performance in 1QFY25 has been weaker than expected. Overall revenue growth for 1QFY25 has been 9% YoY and 20 percent on a 5-year CAGR basis. The jewelery business grew 9 percent in the June quarter, while 17 percent growth was expected. In fact, its jewelery business was affected due to the very high price of gold (+20% YoY) and the short wedding season.
The brokerage says domestic growth came largely through an increase in average selling pressure (ASP), while buyer growth was in low single digits. Performance in the watch segment was ahead of expectations, with revenue growth of 14 per cent, as against the estimate of 10 per cent. Wearables declined 6 per cent on a year-on-year basis. The eyecare division performed weakly, with revenue growing 3 per cent. Caratlane reported 18 per cent growth on a year-on-year basis.
Emerging businesses witnessed softness with 4% revenue growth. Taneera and Fragrance & Fashion Accessories grew by 4%. Store expansion momentum continued across all businesses, with a total of 61 stores added during the quarter.
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Ratings and targets of other brokerages
Brokerage house Goldman Sachs has given a Buy rating on Titan and a target of Rs 3700. Although the brokerage has admitted that the company’s quarterly results are disappointing. Goldman believes that Titan can still achieve its guidance for FY25, it is likely to be at the lower end of the range.
Brokerage house Morgan Stanley has given an equal rating to Titan and has given a target price of Rs 3526. While CLSA has given a target of Rs 4045 with an outperform rating.
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Business Updates
Jewellery and watch giant Titan’s revenue growth was 9 per cent in the June quarter. The Tata Group company said it opened 61 new stores in the April-June quarter. This brought the company’s total store count to 3096. The jewellery segment accounts for nearly three-fourths of Titan’s total business. During the June quarter, the segment grew 9 per cent in the domestic market and the company opened 34 jewellery stores. The company said double-digit growth was witnessed on the occasion of Akshaya Tritiya (Tanishq secondary sales) as compared to the same period last year. However, high gold prices and their continued strength impacted consumer demand.
(Disclaimer: Investing or selling stocks is advised by the brokerage house. These are not the personal views of Financial Express. There are risks in the market, so take expert advice before investing.)