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Titan Company stock rises nearly 4% on strong revenue guidance, brokerages affirm upbeat stance

The large cap stock rose intra day 3.82% to 964 level on the BSE compared to its previous close of 928.55. The stock which opened with a gain of 2.31% at 950 hit an intra day low of 946.80.

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Why brokerages are bullish on the Titan stock

The Titan Company stock rose in trade today after the Tata Group firm said it expects the full-year growth in jewellery business to be around 22 percent. The large cap stock rose intra day 3.82% to 964 level on the BSE compared to its previous close of 928.55. The stock which opened with a gain of 2.31% at 950 hit an intra day low of 946.80. At 12:50 pm, the stock was trading 2.42% higher at 951 level on the BSE. The stock is among the top Nifty gainers today, rising 2.41% to 950.80.

The stock has risen 4.65% during the last one year. It has gained after two days of consecutive fall.

22 of 29 brokerages rate the stock "buy" or 'outperform', five "hold", one "underperform" and one "sell", according to analysts' recommendations tracked by Reuters.

Also read: YES Bank stock trading higher ahead of January 9 board meeting

The stock is trading above its 50-day and 200 day moving average of 919.69 and 870.82, respectively.

The luxury goods firm said it continued the good growth momentum across all its businesses in the seasonally strong third quarter as well, demonstrating the inherent strength of virtually all the brands in its portfolio, and the strong connect with our consumers.

"In the jewellery division, the company continues to witness strong same stores growth, reflecting continuing market share gains. Customer demand was buoyant in the festive season of Diwali-Dussehra, " the firm said in a statement.

Titan Company is engaged in offering watches, jewellery and others. The company's segments include watches, jewellery, eyewear and others. The company offers plain and studded gold jewellery brands, such as Tanishq, GoldPlus, Zoya, Mia, which are retailed through Tanishq, GoldPlus, Zoya & Mia stores.

The company offers watches and accessories, such as bags, sunglasses in brands, including Titan, Sonata, Fastrack and sub brands, such as Raga, Xylys and Edge, among others. It also offers precision engineering component and sub-assemblies (PECSA) and machine building and automation (MBA) solutions. The Company's subsidiaries include Titan TimeProducts Limited, Favre Leuba AG and Titan Engineering and Automation Limited.

Meanwhile, brokerges are bullish on the outlook of the stock post its revenue guidance.

Macquarie

3Q19 update highlights continued strong growth in jewellery division. Implied growth run rate for jewellery in 2H19 is 30% YoY. We are 9-12% ahead of consensus earnings. Remains our top pick, OP, TP Rs 1186

Citi

Target price of Rs 929. Growth momentum remains healthy. Firm could be close To delivering Its five-year growth guidance of 20%. Forecasts over FY18-21 build 18% revenue & 19% EPS CAGR expect market share gain story to continue.

Morgan Stanley

Management comments on Q3 underscore our outlook for strong revenue growth, upside surprise in jewellery operating margin is likely, reiterate firm as our top industry pick in base case, forecast 29% earnings CAGR for FY-21, overweight on the stock with a target price of target price of Rs 1250.

Edited by Aseem Thapliyal

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