Titan Co. drops as jewellery growth moderates; brokerage retains buy

Titan Company fell 4.07% to Rs 4,364.80 after the company reported its provisional business update for Q2 FY27.

The company said its consumer businesses recorded 25% year-on-year growth during the quarter ended 30 September 2026. It added 78 net stores during the quarter, taking its combined retail network to 3,758 stores.

The jewellery business saw a moderation in growth from 39% in Q1 FY27 to around 21% in Q2 FY27.

Titan said consumer demand remained healthy for most of the quarter, although it softened towards the end as the festive calendar shifted towards Q3 FY27. Studded jewellery grew in the early thirties, while plain gold jewellery grew around 20%. Buyer growth was in the mid-single digits, while average ticket sizes increased by double digits.

The watches business grew around 30% year-on-year, supported by premiumisation. Analog watches recorded growth in the early thirties, while the smartwatches business posted high single-digit growth.

The EyeCare division grew around 28% year-on-year, driven by its multi-brand strategy, upgrades to its existing store network and a sharper merchandise portfolio.

Among emerging businesses, fragrances grew in the mid-thirties, women's bags increased in the twenties, while Taneira recorded high single-digit growth.

Titan's international jewellery businesses, comprising Tanishq, Mia and CaratLane, continued to record double-digit growth in North America. The company said its GCC business remained resilient amid geopolitical volatility, with Tanishq showing improving growth and Damas showing early signs of recovery.

The company added 42 net jewellery stores during the quarter, taking the total jewellery store count to 1,269. The watches business added 34 stores, taking its network to 1,379, while EyeCare had 847 stores.

Meanwhile, a foreign brokerage has retained its 'Buy' rating on Titan Company with a target price of Rs 5,425. The brokerage noted that Titan is currently trading at 53x its March 2028 estimated earnings per share (EPS) of Rs 86.1.

The brokerage expects Titan's jewellery business to face a high base in the coming quarters, as the company will be comparing against growth of 40% in Q3, 45% in Q4 and 38% in Q1. It also expects the benefit from elevated gold prices to moderate if prices remain at current levels, which could result in an optical moderation in revenue growth on a quarter-on-quarter basis from Q3 onwards.

Despite these near-term factors, the brokerage expects Titan to report consolidated FY27 estimated sales growth of 19% and EBIT growth of 23%. It has retained its estimates for consolidated jewellery sales and EBIT compound annual growth rates (CAGR) of 19% and 18%, respectively, over FY26-FY30, indicating continued expectations of strong growth.

The brokerage said any optical moderation in sales growth due to the high base, along with a consequent correction in Titan's share price, could provide an opportunity for investors to accumulate the stock. It continues to include Titan among its top sector picks and forecasts an EPS CAGR of 22% over FY26-FY29. The brokerage values Titan at 60x its June 2028 estimated EPS, with all estimates unchanged.

Titan Company is a leading lifestyle company and a joint venture between the Tata Group and TIDCO. Established in 1987, it operates across jewellery, watches, eyewear and other lifestyle categories through brands such as Tanishq, Titan, Titan Eye+, Skinn, Taneira, Irth and beYon, and is known for pioneering organised retail and premium consumer brands in India.

On a consolidated basis, the company's profit after tax increased 62.9% YoY to Rs 1,777 crore in Q1 FY27. Total income rose 29.3% YoY to Rs 21,502 crore during the quarter.

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