Broker’s call: Titan Company (Buy)

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Target: INR 2992

CMP: INR 2734.95

We are still building on TITAN’s results after the fourth quarter Due to strong underlying demand trends for jewelry and scalability in wearables, eyewear and tanneries. Third quarter results were a loss for EBIDTA due to lower profit margins in watches and eyewear and higher losses in startups. Titan is focused on volume-led growth in the jewelry business due to increased competition, while superior mix and volume helps maintain margins.

We expect Titan Corporation To capitalize on long-term growth opportunities led by: jewelry segment gains due to network expansion, regional momentum, and top-line growth in sub-brands such as Mia, Zoya, and Caratlane; Omni Channel strategy across jewelry, watches and eyewear; new growth engines like Caratlane, Titan Eye+, and Taneira; and strong growth in wearables with smart watch volumes exceeding 1 million in FY23.

We believe Eyewear and CaratLane have reached critical mass with EBIT in FY23 of ₹98 crores, ₹166 crores (96 per cent and 177 per cent growth) and will be a major growth driver in the coming years. Titan is gradually emerging as a lifestyle game that will help maintain outstanding ratings.