Titan, Jubilant FoodWorks Get Upgrade From Morgan Stanley Despite Weak Consumption Trends

Morgan Stanley on Friday upgraded its stance on two key consumer stocks— Titan Co. and Jubilant FoodWorks Ltd.— reflecting their resilience in a volatile consumption environment.

Titan's rating has been upgraded to 'overweight' from 'equal-weight' and its target price was also hiked to Rs 3,876 from Rs 3,532 per share. The brokerage sees it as a strong player in the premium consumption space.

Jubilant FoodWorks was also upgraded to 'overweight' from 'equal-weight', with its target price raised to Rs 781 from Rs 620, due to its recovery in the mass discretionary segment.

Despite weak and volatile consumption trends, Morgan Stanley views Titan and Jubilant as well-positioned to thrive, owing to their strategic efforts that build growth visibility. The upgrades are based on three key factors: both companies are creating strong customer loyalty despite a weak backdrop, they are reinforcing their core businesses, and they are consistently gaining market share.

Titan's steady growth strategy, which focuses on capturing a larger share of the gold and jewellery market, stands out as a key differentiator. As competition eases and gold prices stabilise, Titan is well-positioned to benefit from its predictable growth model, which is expected to deliver long-term value.

On the other hand, Jubilant FoodWork’s recent recovery, driven by regional focus, innovation, and cost-cutting measures, like the removal of delivery charges, has allowed it to outpace its peers and regain its growth trajectory.

While margin concerns persist, the companies' long-term growth potential and ability to expand market share will drive investor returns, according to Morgan Stanley.

Shares of Titan and Jubilant FoodWorks both rose over 3% on Friday. While Titan shares were trading 3.71% higher at Rs 3,492.20, Jubilant FoodWorks stock was up 2.78% at Rs 708.05 per share as of 10:50 a.m. This compares to a 0.73% advance in the NSE Nifty 50.

The shares of Titan have fallen 5.45% in the last 12 months. Total traded volume so far in the day stood at 0.52 times its 30-day average. The relative strength index was at 62.

Out of 34 analysts tracking Titan, 19 maintain a 'buy' rating, 10 recommend a 'hold' and five suggest 'sell', according to Bloomberg data. The average 12-month analysts' consensus price target implies an upside of 5.5%.

Shares of Jubilant FoodWorks have risen 34.63% in the last 12 months. Total traded volume so far in the day stood at 0.30 times its 30-day average. The relative strength index was at 53.

Out of 31 analysts tracking Jubilant FoodWorks, 13 maintain a 'buy' rating, 10 recommend a 'hold' and eight suggest 'sell', according to Bloomberg data. The average 12-month analysts' consensus price target implies a downside of 3.1%.