Nomura maintained its ‘Buy’ rating on Titan Company and raised the price target to Rs 5,425 from Rs 5,000. This implies an upside of 10% from the current market price. This increase in the 12-month target price came on the back of several factors like robust Q1 performance, rise in demand growth, and many others.
Titan Q1 robust, ahead of estimates
Titan Company reported a 63% year-on-year surge in consolidated net profit to Rs 1,777 crore for Q1 FY27, with total income rising 40% YoY to Rs 20,753 crore, driven by robust festival and Akshaya Tritiya jewellery demand.
In Q1FY26, the company reported a consolidated net profit of Rs 1,091 crore and total income of Rs 20,753 crore.
Its jewellery category revenue (excluding bullion) climbed 43% YoY to Rs 18,253 crore, fueled by strong seasonal buying. Watches and EyeCare segments posted steady growth of roughly 21% YoY each.
Titan’s overall business performance came above expectations. Segmental revenue grew significantly across the board, with Jewellery up 41% year-over-year, Watches up 21% YoY, Eyewear up 21% YoY, and Emerging Businesses up 36% YoY. This drove strong EBIT (Earnings Before Interest and Tax) growth of 44%, 16%, 20%, and 70% across those respective divisions.
Titan: Resurgence in buyer growth and higher ticket sizes
Buyer growth rebounded to 5% y-y for the quarter after a flat performance in the previous year. Growth was supported by a 31% increase in the average ticket size for TMZ (Tanishq, Mia, Zoya), which was heavily aided by a 60% y-y rise in gold prices.
“Buyer growth in April was strong due to Akshaya Tritiya, weddings and a small moderation in gold prices, but moderated in May due to government interventions (appeal by PM, custom duty hike) and events such as Adhik-maas (inauspicious period). It improved again in June due to softness in gold prices, more than making up for the weakness seen in May. Overall buyer growth for the quarter was decent at 5% (8% in Q4 and flat for the first nine months of FY26) despite elevated gold prices,” said Nomura.
Titan: Margins aligning with guidance
Excluding one-off custom duty gains, adjusted EBIT margins for Tanishq, Mia, and Zoya (TMZ) were strong at 11.7% and 10.1% for CaratLane. These margins tracked closely with or exceeded management’s guided ranges of 11% for TMZ and 10% for CaratLane.
Improving sales mix and diamond market stability
Softness in gold prices helped improve the quarterly product mix, driving 34% YoY growth in studded sales. Additionally, natural diamond prices stabilised, and the competitive narrative regarding lab-grown vs. natural diamonds moderated, indicating that both segments are coexisting and catering to distinct consumer needs.
“Natural diamond prices, for both solitaires and smaller diamonds, have shown stability, and the market narrative regarding lab-grown vs natural diamonds has also moderated, with both coexisting and catering to different customer needs,” said Nomura.
Titan: Growth opportunity and operational playbook
Nomura raised its FY27–29 EPS estimates by 3% to account for the strong Q1 results, projecting a 22% EPS CAGR over FY26–29. This outlook is on the back of Titan’s intact long-term headroom for growth and the activation of a strategic playbook designed to help the company navigate a high comparative base in the second half of the year.
Titan share price performance
The share price of Titan has risen 1.8% in the last five trading days. The stock has surged 10.4% in the past one month and 18.6% in the last six months. Titan’s share has given a return of more than 45% over the past one year.