Fundamental Radar: Underperformer of 2022, Titan could rally over 20% in 2023; time to buy?

The gems and jewelry stock which remains subdued could well hit Rs 3,210 in the next 12 months which translates into an upside of over 22% from Rs 2,615 recorded on 5 December, suggest experts.

Long-term growth story remains intact for Titan Company which is the largest organised player in the organised jewelry market, but still has a market share of less than 10%.

“With customers gradually shifting to organised players and given continued struggles faced by its unorganised and organised peers, Titan has a strong runway for growth,” Sneha

, Associate Vice President at Limited, said.

As per the Confederation of All India Traders (CAIT), about 32 lakh weddings are scheduled to take place between 4 November to 14 December which is likely to generate business of at least Rs 3.75 lakh crore. This will benefit Titan in a big way.

“In fact, Q3 has started on a very strong footing for the company and the management expects 2HFY23 to be buoyant, aspiring 30% growth for FY23,” highlights Poddar.

is targeting 2.5x of FY22 sales by FY27, i.e. ~20% CAGR. It aims to open more than 600 Tanishq stores over the next three years (389 stores in March 2022).

“Its medium-to-long-term earnings growth visibility is best among largecap consumer and retail companies. Despite the volatility in gold prices and COVID-led disruptions, earnings grew at a stellar pace of 24% CAGR over the last five-years,” she added.

“We expect this trend to continue, with a 31% earnings CAGR over FY22-24. A long runway for profitable growth warrants premium multiple for Titan. We remain positive, with a TP of Rs 3,210 per share,” recommends Poddar.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)