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Rakesh Jhunjhunwala, wife Rekha have earned Rs 915 crore with Titan Company stock since March this year

Aseem Thapliyal     June 10, 2019

Ace investor Rakesh Jhunjhunwala and his wife have made handsome profit from investment in Titan Company share since March.  The Jhunjhunwala couple has made Rs 914.91 crore from their investment in the Titan Company stock since March quarter. Currently, they hold over Rs 8,040 crore in this jewellery maker stock. At the end of March quarter, the couple had Rs 7,125 crore investment in the stock.

Rakesh Jhunjhunwala who held 5.72% stake or 5.07 crore shares in the firm at the end of March quarter is sitting on a profit of Rs 743.86 crore. The Titan Company stock price stood at Rs 1,141.05 on March 29, 2019. It hit an all-time high of Rs 1,287.55 in trade today.

His wife Rekha Jhunjhunwala who owned 1.32% or 1.16 crore shares of Titan Company during the period under consideration has earned Rs 171.05 crore in profit from her investment in the consumer durables firm.

Rakesh Jhunjhunwala first bought 6 crore shares of Titan in 2002-2003 at a price of Rs 3, according to media reports. Since then, he has been buying and selling Titan shares in his portfolio. Jhunjhunwala, who is also called India's Warren Buffett, pared his stake from 5.78% or 5.13 crore shares at the end of December quarter in 2018 to 5.72% in the last quarter.

This stock was valued just Rs 4 in 2009, now it's worth over Rs 650!

However, his wife's stake saw an increase in shareholding during the same period. Rekha Jhunjhunwala's stake in the firm rose from 1.30% or 1.15 crore shares at the end of December quarter to 1.32% stake in the March quarter.

A rise in the wealth of the couple can be attributed to the Titan Company stock touching new high.  From Rs 1141.05 on March 29 this year, the stock rose 12.83% to its all-time high of Rs 1287.55 in trade today.

Rakesh Jhunjhunwala turned Rs 1 lakh into Rs 7.5 lakh in 4 years with this stock!

The stock also received positive cues from the trend in earnings for Q4 and the last fiscal.

Titan Company reported a 14.4% rise in its consolidated net profit for the quarter ended March 31.

The firm posted consolidated net profit of Rs 348.3 crore compared to Rs 304 crore in the same quarter last year. Total revenue rose 19.87% at Rs 4,945 crore compared to Rs 4,125 crore on a year ago basis.

The maker of Titan watches and Tanishq jewellery made provisions to the tune of Rs 46 crore for investments made as part of treasury operations in inter-corporate deposits in the IL&FS Group. Total income increased to Rs 4,945.06 crore for the quarter under review as compared to Rs 4,125.69 crore in the same period of 2017-18, Titan Company said.

For 2018-19 fiscal, the company posted a net profit of Rs 1,388.65 crore as against Rs 1,101.91 crore in 2017-18. Total income during the last fiscal rose to Rs 19,961.46 crore from Rs 16,244.81 crore in 2017-18.

After the Q4 earnings were announced on May 8, Motilal Oswal gave a target price of Rs 1310 on May 11 coupled with a buy call. On May 10 Friday, the stock price stood at 1131 level on BSE. In a report dated May 11, the brokerage said, "For a business that has (a) the best top-line growth visibility in the large-cap FMCG/retail space (20% compounded annual growth rate in jewellery, the largest segment, over the next four years);

(b) prospects of continued earnings before interest tax depreciation and amortisation (EBITDA) margins improvement because of high SSSG contribution and (c) sustained return on capital employed (ROCE) improvement from 26% in FY19E to 34% in FY19, Titan's high valuations are fully justified. In fact, increasing doubts over topline and earnings growth of many consumer peers should also ensure high multiples for Titan. Maintain Buy with target price of Rs 1,310 (targeting 50 times FY21E earnings per share)."


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