Rekha Jhunjhunwala portfolio: After 28% rally, Titan poised for another 15% upside, says Motilal

The company added 81 stores during the quarter. It is making healthy progress in retail store expansion, with the total retail footprint (including CaratLane) increasing to 2,859 stores at the end of Q2FY24.

Titan's jewelry division grew 19% YoY (excluding bullion sales), driven by studded activations, new collection launches, robust Golden harvest sales, a healthy wedding season and high-value studded purchases, during the quarter under review. The segment posted a 3-year/4-year revenue compound annual growth rate (CAGR) of 27%/21%.

"Unlike other high-growth categories, competitive intensity from organised and unorganised peers in jewelry is considerably weaker," Motilal said in a note.

In the Watches & Wearables division, Titan reported a growth of 32% YoY, with 22% growth in analog watches and 131% YoY growth in wearables. The growth in analog watches was driven by healthy sales in the mid-to-premium

watches segment.

The eyecare division is expected to see revenue growth of 12% YoY.

CaratLane grew 45% YoY, driven by equal growth in studded sales, new collections, gifting campaigns and ‘old gold’ exchange program initiatives. It added 13 new domestic stores during the quarter, increasing its total network to 246 stores in 97 cities.

The structural investment case for Titan Company is intact, the brokerage said, assigning a 'Buy' rating on the stock with a target price of Rs 3,795 per share. This indicates an upside potential of 15 percent from the current market levels.

The Titan stock settled 1.35 percent lower at Rs 3,265 apiece on the NSE in trade today. So far in 2023, the stock has rallied 27.52 percent and it has gained 22 percent in the last one year.

Ace investor Rekha Jhunjhunwala owns 47,595,970 equity shares, or a 5.36%, stake in the Tata group company as of June 30.