Titan Q4 Results Review - Miss On Profitability; Sustaining Focus On Growth: Motilal Oswal

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .Motilal Oswal Report.Titan Company Ltd. posted consolidated sales growth of 21% YoY in Q4 FY24, marginally better than our estimate. However, Ebit margins across segments were weak, leading to an overall 8% miss on Ebitda in Q4 FY24.  jewelry sales (ex-bullion) grew 22% YoY, with double-digit growth in the number of buyers. The studded ratio expanded to 33% (same YoY). Net store additions were slow, at 39 in Q4, bringing the total to 937 stores (174 store additions in FY24). Like-for-like growth for Tanishq was healthy at 14% (15% FY24), while Caratlane’s growth was slower at 3% in Q4 FY24 (6% FY24). The Jewelry segment’s Ebit growth was slow at 9% YoY; the segment witnessed gross margin pressure, which was due to high consumer offers and gold inflation (11% YoY). Standalone Ebit margin (ex-bullion) was 12.1% (flat QoQ) versus 13.2% YoY. In the rising competitive environment, Titan Company preferred growth over profitability to sustain its competitiveness. .The watch segment grew by only 6% YoY due to pricing cuts taken by the company to remain competitive in the market. Analog watches rose 9% YoY, while Wearables grew 3% YoY during the quarter. The near-term growth outlook appears subdued due to high gold inflation affecting demand sentiments, which is a typical trend during inflationary periods. However, despite the near-term jitteriness, the company remains aggressive in its growth outlook, driven by new store additions, attractive designs, and market share gains, et al. Titan Company also maintains a Jewelry Ebit margin of 12-13% for FY25. We will monitor the near-term consumption trend. However, due to competitive pressure on margins, we cut our earnings per share estimates by 6%/ 5% for FY25/26. Reiterate Buy with a target price of Rs 4,100..Click on the attachment to read the full report:.Titan Q4 Results: Profit Rises, But Misses Estimates.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Titan Q4 Results Review - Miss On Profitability; Sustaining Focus On Growth: Motilal Oswal

Sales in line; margins below expectations

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