Titan Shares Surge as Analysts Revise Targets Post Q3 Results; Investment Outlook Explored

Titan Company has reported a robust performance in the third quarter of FY24, registering a net profit growth of 9.4% YoY, reaching ₹1,040 crore. The company’s revenue from operations for Q3FY24 also demonstrated a strong upward trajectory, increasing by 20% to ₹13,052 crore from ₹10,875 crore YoY.

While EBITDA during the quarter rose by 9.5% YoY to ₹1,457 crore, the EBITDA margin experienced a marginal contraction of 100 basis points, settling at 11.2%, down from 12.2% YoY.

In the jewelry segment, total income for Q3 witnessed an impressive 23% growth over Q3FY23, reaching ₹11,709 crore. The segment’s EBIT stood at ₹1,432 crore, with a margin of 12.2% for the quarter.

The quarter faced challenges, with jewelry sales being impacted by the Shradh month in October and a December slowdown attributed to an increase in gold prices. However, the company’s management remains optimistic about a stronger performance in 4QFY24, citing a recovery in jewelry sales observed in January 2024.

Despite Q3 margin misses, analysts express confidence in Titan’s medium to long-term prospects, driven by strong demand and international expansion. Many analysts have raised their target prices on Titan shares based on these positive factors.

Nuvama Institutional Equities remarked on a historic average multiple of 60x for Titan, adjusting the target multiple to 65x to account for potential international expansion. The firm maintains a ‘Buy’ rating and increased the target price to ₹4,106 per share.

Antique Stock Broking noted a marginal below-estimate profitability for Titan in Q3FY24, particularly due to a contraction in jewelry margins. Despite this, the brokerage remains optimistic about Titan’s future and maintains a ‘Buy’ recommendation, raising the target price to ₹4,100.

Motilal Oswal Financial Services highlights Titan’s healthy growth outlook, favorable industry trends, and strong balance sheet as key strengths. The firm maintains a ‘Buy’ rating with a target price of ₹4,200 per share, positioning Titan as its top consumer discretionary play in India.

Centrum Broking remains upbeat on Titan’s operating performance, emphasizing its promising foothold in the international market. With stable margin outlook, the brokerage maintains a ‘Buy’ call and raises the target price to ₹4,255 per share from ₹3,780.

As of 9:25 am, Titan Company shares were trading 1.03% higher at ₹3,663.30 apiece on the BSE.