Titan shares advance 4% as Q2 update surpasses expectations; time to buy?

Titan's consumer businesses grew about 20 per cent Y-o-Y in the September quarter, adding 55 stores to reach 3,377

Shares of Titan rose over 4 per cent on Wednesday as analysts remained bullish after the company reported a better-than-expected second quarter update.

 

The jewellery and watch maker's stock rose as much as 4.29 per cent during the day to ₹3,564.9 per share, the biggest intraday rise since May 9 this year. The stock pared gains to trade 4 per cent higher at ₹3,555 apiece, compared to a 0.26 per cent advance in Nifty 50 as of 9:58 AM. 

 

Shares of the company snapped a two-day losing streak and currently trade at 30 times the average 30-day trading volume, according to Bloomberg. The counter has risen 9.3 per cent this year, compared to a 6.5 per cent advance in the benchmark Nifty 50. Titan has a total market capitalisation of ₹3.1 trillion.   

Titan Q2 update 

Titan Company's consumer businesses grew around 20 per cent year-on-year (Y-o-Y) in the second quarter of FY26, with the company adding a net 55 stores during the quarter to take its total retail network to 3,377 stores.

 

Domestic businesses grew 18 per cent, with jewellery up 19 per cent, watches 12 per cent, and eyewear 9 per cent. Key jewellery brands Tanishq, Mia, and Zoya grew 18 per cent, while CaratLane recorded 30 per cent growth. Emerging businesses saw 37 per cent growth, and international operations rose 86 per cent.

 

The growth was supported by rising gold prices, which drove higher ticket sizes despite marginal Y-o-Y declines in buyer counts, the company said in its Q2 update. The impact of the high base in Q2FY25, following a customs duty reduction, was offset by the early onset of the festive season in September this year. 

 

Strong consumer promotions, including exchange offers and marketing initiatives, also helped stimulate demand amid elevated gold prices. Studded jewellery in Tanishq, Mia, Zoya portfolio collectively grew in mid-teens outpacing gold jewellery growth, while gold coins continued their strong run, Titan said.  CATCH STOCK MARKET LIVE UPDATES TODAY

Analysts on Titan Q2 update

Antique Stock Broking remains confident of a 19 per cent CAGR in Titan’s jewellery revenue over the next three years. While jewellery Ebit margin bottomed out at 9.7 per cent in FY25, it is expected to improve to 11.8 per cent over the same period. 

 

The brokerage believes Titan’s medium- to long-term performance will be driven by market share gains in the jewellery business, supported by a strong brand, effective execution, and expansion of its store network. Improving profitability in other segments also bodes well for the company.

 

JM Financial expects Titan’s domestic jewellery revenue to grow around 19 per cent Y-o-Y, with Tanishq, Mia, and Zoya reporting 18 per cent growth excluding bullion, well above their earlier estimate of 12 per cent.

 

Overall, standalone revenue is projected to rise about 18 per cent Y-o-Y, driven by jewellery growth. Jewellery Ebit margin is expected at 11.1 per cent, while standalone Ebitda and profit after tax (PAT) are estimated to grow 48 per cent and 53 per cent Y-o-Y, respectively.

 

Meanwhile, Nomura said that the Q2 update came in much better than estimated. The brokerage maintained a 'buy' rating with a target price of ₹4,275 per share.