ICICI Securities: Titan Company - Best Positioned To Gain From Faster-Than-Expected Recovery
An employee holds a 50-gram gold coin for a photograph inside a Titan Co. Tanishq jewelry store in Mumbai, India. (Photographer: Dhiraj Singh/Bloomberg)

ICICI Securities: Titan Company - Best Positioned To Gain From Faster-Than-Expected Recovery

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

ICICI Securities Report

Titan Company Ltd.’s Tanishq revenues have recovered to 90% of pre-Covid-19 levels – significantly ahead of consensus expectations – likely drivers are -

1. boost to volumes due to (somewhat) stable gold prices,

2. consumers have (likely) started accepting higher gold prices and expect further inflation and

3. market share gains (liquidity challenges for smaller competitors).

Upside trigger is gold price correction or volatility leading to surge in volumes ( (recall the 67% volume growth in Q1FY14 - see table 1)

That said, introduction of fixed making charges, even though a small proportion currently, is something that we will watch carefully.

Profitability under pressure (in FY21) from inferior studded share is adequately priced in (stock down 12% in last one year).

Click on the attachment to read the full report:

ICICI Securities Titan Company Update.pdf

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