Titan gets Nomura 'Buy' call on strong jewellery market, 27% upside eyed

Analysts at Nomura have initiated coverage of Titan with a 'Buy' rating and a target price of ₹4,275, highlighting the company's strong positioning relative to peers on a risk-weighted basis.

Japan-based brokerage Nomura expects demand for jewellery in India to ‘remain unfazed,’ with organised players continuing to grow 1.5 times faster than the overall industry at mid-teens rates. 

 

That said, the analysts at Nomura have initiated coverage of Titan Company Limited with a ‘Buy’ rating and a target price of ₹4,275, highlighting the company’s strong positioning relative to peers on a risk-weighted basis.

 

On the bourses, Titan shares were trading higher in a weak market. At 11:02 AM, Titan share price was trading 0.25 per cent higher at ₹3,386.50 per share, even as benchmark BSE Sensex was trading 0.49 per cent lower at 80,765.46 levels.

 

Indian jewellery market to double by FY33

 

The Indian jewellery market has witnessed major structural growth, doubling from $48 billion in FY18 to $90 billion in FY25 at a compound annual growth rate of 9 per cent. It is expected to nearly double again to $150 billion by FY33E. The expansion, analysts said, is largely underpinned by India’s deep-rooted cultural affinity for jewelry, with weddings accounting for 50-55 per cent of the market. 

 

Favourable demographics further support this trend, with around 25 per cent of the population in the ‘marriageable’ age group, increasing from 365 million in 2023 to 390 million by 2030. At the same time, rising incomes are driving demand for daily wear and fashion jewelry across a broader segment of the population. 

 

Organised players shine

 

Organised players have outpaced overall industry growth, registering a 14 per cent compound annual growth rate (CAGR) between FY18 and FY25. Their market share has expanded from 30 per cent in FY18 to 40 per cent in FY24 and is projected to reach 45 per cent by FY30E. This acceleration, analysts believe, is supported by regulatory improvements, higher standards of purity and transparency, and better workmanship, which are critical in a trust-sensitive market.

 

Despite high gold prices, organised players are innovating to sustain growth, analysts noted. Monthly installment plans and old-gold exchange schemes are easing the burden of upfront costs for customers while encouraging loyalty. Lightweight jewelry offerings, expansion into e-commerce, and the establishment of stores in Tier 2, 3, and 4 cities are further supporting growth. Nomura stressed that jewellery acts as a staple in the discretionary sector, purchased across economic strata, positioning organised players as key beneficiaries of the rising affluent and elite income population. 

 

Gold schemes, in particular, have become an effective growth driver, allowing customers to reduce making charges by 30-70 per cent, a key hurdle in acquiring new customers. Store economics are also evolving, with models balancing operational control, capital deployment, and asset-light expansion, enabling profitable growth. Access to gold through metal loans provides organised players with raw materials at low cost, improving working capital efficiency, supporting expansion, and acting as a hedge against price volatility, Nomura analysts noted.

 

The competitive landscape remains challenging but not disruptive. Organised players are aggressively expanding into untapped markets and increasing their focus on studded jewelry to strengthen profitability. 

 

Lab-grown diamonds have not had the disruptive impact once feared, as small diamond jewellery – the largest contributor to sales – remains largely insulated, and cultural preferences for real jewellery continue to dominate in India.

 

Titan stock: Valuations, key risks

 

Nomura valued Titan at a price-to-earnings (P/E) of 60 times September-27F earnings per share (EPS), broadly in line with its 10-year average trading multiple. The stock currently trades one standard deviation below its five-year average, offering potential valuation comfort. The brokerage forecasts an EPS CAGR of 24 per cent over FY26-28F and expects most headwinds to be behind post Q2FY26. 

 

“We forecast an EPS CAGR of 24 per cent over FY26-28F. We believe most headwinds will be behind us post Q2FY26 (weak quarter),” said Mihir P Shah and Riya Patni of Nomura, in a note dated September 25, 2025.

 

Key risks, analysts said, include potential slowdowns in sales growth due to high gold prices or competition, as well as margin pressures from lab-grown diamonds and competitive intensity. 

 

Nomura views the Indian jewellery sector as set for sustained growth, driven by formalisation, rising incomes, and innovation. Titan, with its strategic positioning and focus on organised expansion, analysts believe, is expected to be a key beneficiary of these structural trends, making it an attractive investment in the discretionary space.