Q2FY22 Company Update - Titan Company - ICICI Direct

Key highlights of Q2FY22 update

- Titan witnessed a strong recovery in demand across segments. Overall store operational days exceeded 90% in Q2FY22.

- Titan's overall Q2FY22 revenue print was significantly ahead of consensus estimates. Standalone revenue growth (excluding gold bullion sale) was at 78% YoY (vs. consensus estimate of ~40%)

- Tanishq continues to gain market share amid robust topline growth of 78% YoY with an impressive two-year CAGR of 32% in Q2FY22. It surpassed pre-Covid levels in H1FY22 with growth of 16% vs. FY20 levels

- Watches segment witnessed a swift recovery with revenue growth of 73% YoY in Q2FY22 (~96% of pre-Covid levels)

Key triggers for future price performance

- Robust balance sheet and asset light distribution model has enabled it to outpace peers in terms of store addition (to add ~35 Tanishq stores in FY22)

- Tanishq's penetration is still at a very nascent stage in the Indian jewellery market. This provides immense opportunity for Titan to enhance its market share. Mandatory gold hallmarking is expected to further enhance market share gains from the unorganised space

- Thrust on wedding space is bearing fruit with wedding jewellery becoming a critical growth driver while its share in overall jewellery revenue has increased meaningfully

- Gradual recovery in studded ratio would aid margins, going forward

- We bake in revenue, earnings CAGR of 22%, 53%, respectively, in FY21-24E

Shares of Titan Company Limited was last trading in BSE at Rs. 2376.20 as compared to the previous close of Rs. 2146.80. The total number of shares traded during the day was 259438 in over 16629 trades.

The stock hit an intraday high of Rs. 2383.35 and intraday low of 2222.85. The net turnover during the day was Rs. 608287777.00.

For details, click on the link below: Link to the report

Source : Equity Bulls

Keywords

TitanCompany INE280A01028 TITAN Q2FY22 CompanyUpdate ICICIDirect ICICISecurities