Titan Company’s stock reaches a fresh 52-week high on the back of a robust June-quarter with a 63% profit increase, buoyed by favourable brokerage reviews and sustained jewellery sales growth despite market concerns.
Titan Company’s shares rose for a second straight session on Monday after a strong June-quarter update and a wave of upbeat brokerage commentary pushed the stock to a fresh 52-week high. The stock climbed to Rs 5,121.30 before easing to around Rs 5,057 in morning trade, giving the Tata Group company a market value of roughly Rs 4.49 lakh crore.
The latest rally has been driven by Titan’s first-quarter numbers, which showed consolidated net profit rising 63% year-on-year to Rs 1,777 crore on total income of Rs 20,753 crore, according to the company’s results. Jewellery remained the main engine of growth, with revenue in that division up 43% to Rs 18,253 crore excluding bullion and digital gold sales. Titan said festive buying, Akshaya Tritiya demand, exchange schemes and relatively stable gold prices supported performance. Industry watchers said the figures have eased some concerns that elevated gold prices and changing consumer habits might slow demand.
Brokerages broadly remain constructive. Citi said jewellery revenue and operating profit growth stayed strong even after stripping out bullion sales and other one-offs, and it raised its target price to Rs 5,700 from Rs 5,075. Motilal Oswal kept its Buy call and target of Rs 6,000, arguing that Titan continues to outpace other branded jewellers because of its sourcing strength, focus on studded jewellery and appeal to younger shoppers. Nomura also reiterated a Buy rating, with a Rs 5,000 target, after Titan’s consolidated sales rose 41% year-on-year and beat its estimate. Emkay has an Add rating and a Rs 5,600 target, saying the group has answered some growth concerns.
Not everyone is equally enthusiastic. Nuvama cut Titan to Hold from Buy after the recent share-price run, though it lifted its target to Rs 5,241. It pointed to risks from gold prices, discretionary spending and possible duty changes. Titan’s valuation remains rich by market standards, with the stock trading at about 78 times consolidated earnings. For existing shareholders, analysts largely see room to stay invested. For new buyers, the recent surge means the case for chasing the stock at record levels is less compelling than waiting for a pullback.
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