Titan Company share rose in afternoon trade today as stocks of consumer durables goods pushed the market higher set to close in the green for second consecutive session. A rise in gold price above Rs 50,000 per 10 gram mark in the Mumbai retail market also tilted sentiment in favour of the gems and jewellery maker. The stock was the top gainer in the consumer durables sector today.
Share price of Titan Company gained 4.74% or Rs 45 intra day to Rs 993.70 against previous close of Rs 948 on BSE. The stock closed 3.98% higher at Rs 986.35.
The large cap stock has gained after 6 days of consecutive fall.
The stock trades higher than 5 day, 20 day and 50 day moving averages but lower than 100 day and 200 day moving averages. However, the share of Titan has lost 25.42% in one year and fallen 16.83% since the beginning of this year.
Market cap of the firm rose to Rs 87,353 crore. Total 1.93 lakh shares of the company changed hands amounting to turnover of Rs 18.84 crore. The stock hit 52 week high of Rs 1,389 on October 10, 2019 and 52 week low of Rs 720 on March 24, 2020.
Consumer durables led the gains with the BSE index rising 552 points or 2.73% to end at 20,822 against previous close of Rs 20,360. Top gainers on the index were Titan, Symphony (3.61%) , Voltas (3.59% ), Whirlpool (2.13%) and TTK Prestige (1.44%). Sole loser on the ten-stock index was Orient Electric falling 0.93% to Rs 196.10.
Here's what brokerages said about the Titan Company stock
JM Financial has a hold rating on Titan Company Ltd with a 12-month target price of Rs 1,040. The last traded stock price was Rs 977.25
Titan's annual investor 'meet' was a sombre affair this time round and no one wanted to spell out a specific growth target for this year or the next. The message , says the brokerage, was very clear. Key task at hand is to ensure businesses get back on their feet at the earliest and once the situation normalises, be aggressive on growth and market shares.The brokerage maintained a hold rating as FY21E could be a tough year given possible spill-over effects of a locked economy on jobs, income and consumer sentiments.
Sharekhan has given a Buy call on the stock with a target price of Rs 1,130.
Titan Company Limited (Titan) posted mixed performance in Q4FY2020 with consolidated revenue declining by 4.3% affected by the lockdown; however, high gross margin led to PAT declining by 2% to Rs 342.8 crore (better than our as well as street expectation). Post the easing of the lockdown norms, 85% of Tanishq stores and 75% of World of Titan stores are operational.
Jewellery and watches businesses are expected to come to normalcy by Q4FY2021. With strong traction to Gold Exchange Scheme, pent-up wedding demand, and gold being the safest asset class for investment, near-term growth prospects are intact for the jewellery business. Stable balance sheet and strong brand positioning would aid Titan to gain market share from smaller players. The stock has corrected by 24% in the past four months.
Motilal Oswal Financial Services said the investors should remain little cautious going ahead as the first quarter of the ongoing fiscal may be painful for the company. The June quarter of FY21 would be negatively impacted owing to the 'ineffective hedge' on account of higher gold prices, which would be reversed in subsequent quarters.
"In addition to the COVID-19 impact, higher prevailing gold prices and the likely lower share of high-value studded jewellery would weigh on profitability. Moreover, management's reluctance to reduce staff costs, while good for long term growth, would have an adverse impact on near-term profitability," Motilal Oswal added.
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