Titan - Glittering Track Record; Long Runway For Growth: Motilal Oswal

Motilal Oswal Report

Titan Company Ltd. has scaled up its emerging jewelry business to ~Rs 455 billion in FY24E (88-90% revenue mix) from Rs 3 billion in FY03 (40% revenue mix), one of the few consumer companies to have achieved such a feat.

The company’s record performance has been driven by its early-mover advantage in the organised industry and consistent scale-up of business by being more agile in design and consumer engagement.

Titan Company's jewelry and other businesses still have strong long-term growth potential. With a jewelry market share of ~8% in a sizable ~Rs 5 trillion market, there is significant headroom for growth for Titan. The gradual recovery in the studded ratio should support margin improvement.

We are cautious about the near-term consumption trend, but we continue to prefer Titan for its best-in-class execution track record and its eagerness to expand the user base. Consumer preference for branded jewelers will keep the robust growth rate intact for the category.

We reiterate our Buy rating with a target price of Rs 4,300 (based on 65 times FY26E earnings per share).

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