Titan gains for third consecutive week owing to positive business prospects

The share of Titan Company continued its stellar gaining streak for the third consecutive week. The stock has gained 15 per cent during this timeframe. Supportive business trends and better-than-expected revival in the economic activity has helped the stock price gain during this period.

Titan derives high value from its dominance in the jewellery and watches segments. It enjoys market share as high as 65 per cent in the premium watch segment and 10 per cent in the jewellery segment. The company recently published its data regarding operational performance in the second quarter. The return to normalcy on the business front has picked up a good pace in the quarter. Its focus on acceleration in the digital transformation for better sales and brand positioning has played its part, for which, the company has made investments in the last three years.

Its largest segment i.e. jewellery did quite well in Q2. The recovery at a rate of around 98 per cent (excluding the sale of raw gold) in Q2, compared to the revenue of same quarter in last year, shows strong recovery in the overall business environment. Its other business division, watches & wearables, clocked recovery rate of around 55 per cent in this quarter, as compared to the revenue of the same quarter during last year. For only September, recovery stood at 70 per cent for this segment. Overall, e-commerce is leading the recovery with an absolute growth but the trade channel continues to pose challenges primarily due to destocking.

The closest peers such as Rajesh Exports and Asian Star Company saw laggard stock price performance. Both the scrips are trading at a discount of more than 40 per cent from their 52-week high.

On Friday, the share price of Titan closed at Rs 1,261 on BSE.