Titan Shares Gain On Reports Of Tanishq's Likely Foray In US & Other West Asian Markets

Titan shares in early trade today rallied by close to 3% to day's high price of Rs. 2540 apiece on the NSE. In the previous session, the Tata group watch and jewellery entity closed at Rs. 2466.45 per share.

As per media reports, Titan is planning to take its jewellery brand Tanishq to the US and other West Asian markets as part of its long-
term strategy to tap into the demand from large Indian diaspora and Non-Indian Resident (NRIs) communities. On the domestic front the company expects the demand to be driven ensuing festive season with consolidated YoY revenue growth of around 15-20%.

ICICI Direct is bullish on the prospects of the company and in its report says that "Tanishq had opened its first international store in November 2020 in Dubai and currently has four stores at international locations. The company is planning to open 20-30 stores in the next 2-3 years in North America and West Asia which would enable it to serve the vast diaspora of people of Indian origin residing in these international locations. On the domestic retail front, the company is expecting a strong festive season and is planning to adopt a combination of product innovations, new launches and marketing investments besides promotional offers to capture the expected demand.

On a YTD basis, the stock has remained more or less static, while its 3-year returns are at a good 129%. Late Rakesh Jhunjhunwala had a sizeable stake in the firm to the tune of 3.98% as of June 30, 2022.

Sharekhan in its latest report on the stock has maintained a 'Buy' for a target price of Rs. 2900. As for its view on the scrip, Sharekhan said, "Titan is aiming to grow its revenue at CAGR of over 20% over FY2022-27 on back of its ambitious growth plan in the medium term. This along with consistent improvement in margins will help cash flows improve strongly in the coming years. FY2023 will be a strong year for the company on back of low base in the core businesses. Stock is currently trading at 67.9x and 53.7x its FY2023E and FY024E earnings. The company's strong growth outlook, industry tailwinds in the medium term and strong balance sheet makes it a best play in the retail space. Hence we maintain our Buy recommendation on the stock with an unchanged price target of Rs. 2900"