According to UBS, its store checks indicate that growth momentum has remained intact, although disruptions in the Middle East could weigh on international growth in the near term.
The brokerage believes Titan Company remains a major long-term compounding story within India’s consumer space. Here’s why:
– UBS said Titan is still midway through its compounding journey, even though the stock has risen about 22% since October after remaining largely flat for the previous two years.- The brokerage added that Titan’s consistent operating performance and margin delivery have continued to exceed expectations, helping the company move beyond concerns around gold price volatility and rising competition.
– UBS also said that Titan is a key beneficiary of the long-term shift from the unorganised to the organised jewellery market in India, which could support a 15-20% revenue growth trajectory over the next several years.
– The brokerage said Titan’s foray into lab-grown diamonds under the Beyon brand allows the company to shape the value proposition in studded jewellery while mitigating long-term risks to the category.
– Meanwhile, Titan’s international jewellery brand Damas could emerge as another engine for growth and value creation over the next few years, provided the geopolitical situation stabilises, UBS added.
Shares of Titan Company were trading 2% lower at ₹4,057.30 on Thursday. The stock is largely flat so far this year.
