Titan hits new all-time high; enters Rs 3 trillion market-cap club

The stock hit a new high of Rs 3,400, up nearly 2 per cent on the BSE in Tuesday's intra-day trade on expectations of healthy December quarter earnings

Titan Company today became the second Tata group firm to join Rs 3 trillion market capitalisation (market cap) club after its shares hit a new high of Rs 3,400, up nearly 2 per cent on the BSE in Tuesday's intra-day trade.

At 12:28 PM; with a market cap of Rs 301,847 crore (Rs 3.02 trillion) Titan stood at number 16th position in overall market cap ranking on the BSE listed companies, the exchange data shows. Titan today overtook paint company Asian Paints, which has a market cap of Rs 300,579 crore, data shows.

Tata Consultancy Services (TCS) is the other Tata group company which is at number two ranking with Rs 12.95 lakh crore market cap.

Thus far in the month of November, Titan has outperformed the market by gaining 7 per cent, on expectations of healthy December quarter (Q3FY24) results. In comparison, the S&P BSE Sensex was up 3.3 per cent. In the past six months, the stock has rallied 25 per cent, as against 6.4 per cent rise in the benchmark index.

The management while announcing September quarter (Q2FY24) results on November 3 had said the festive season in Q3 started well and they are optimistic for the company's performance in the rest of the financial year.

Titan, a joint venture between the Tata Group and the Tamilnadu Industrial Development Corporation (TIDCO), commenced its operations in 1987 under the name Titan Watches Limited.

In 1994, Titan diversified into Jewellery (Tanishq) and subsequently into EyeCare. Over the last three decades, Titan has expanded into underpenetrated markets and created lifestyle brands across different product categories including fragrances (SKINN), accessories and Indian dress wear (Taneira) and thoughtfully designed Women Bags (IRTH).

In Jewellery, Titan holds 7 per cent market share in the Indian jewelry market and target to achieve double-digit share in next 3-4 years. The division's five-year CAGR for revenue/EBIT stood at 22 per cent/24.6 per cent. It enjoys a significant share in the organized market of watches and wearables and launch products in the premium category of Eye Care.

Titan has a strong runway for growth in the consumption space in India, with robust earnings growth visibility and compounding for the long term, according to Motilal Oswal Financial Services.

The gradual recovery in the studded ratio is expected to support improved gross margin in the future. Its healthy growth outlook, favorable industry trends, and a strong balance sheet, make it a compelling option in the discretionary sector. The company has an impressive track record of outperforming its peers as well as exceptional long-term growth potential, all of which justify its premium valuations, the brokerage firm said.

In Q2FY24, Titan reported a resilient performance with topline increasing significantly. Revenue is expected to surge owing to the upcoming festival season. The expansions in both domestic and international markets portray a strong vision towards growth. Innovation and new products remain key focus points for boost in performance. However, the competitive environment and increasing input costs pose a threat to the margins, according to analysts at Geojit Financial Services.