A global brokerage sees the strong possibility of an upswing in Titan‘s share price over the next two weeks, driven by the jewellery segment.

What Happened: Morgan Stanley reiterated its “equal-weight” rating on Titan, setting a target price of ₹3,570 per share and estimating an 80% probability that the stock will rise within the next 15 days.

Morgan Stanley expects the jewellery segment, which contributes significantly to Titan’s business, to see a robust 16% year-on-year revenue growth, largely driven by increased demand following a reduction in import duties on gold in July.

In July 2024, India’s Finance Minister Nirmala Sitharaman announced a reduction in the import duty on gold from 15% to 6% in the Union Budget. This marked the largest cut ever and the lowest duty rate since June 2013.

Morgan Stanley also noted that the delayed occurrence of the Pitru Paksh period last year had created a high base effect, contributing to the current year’s growth outlook. Additionally, the brokerage highlighted improvements in Titan’s growth momentum.

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Titan, part of the Tata Group, primarily manufactures fashion accessories, including jewellery, watches and eyewear. The company was established as a joint venture with TIDCO and has its corporate headquarters in Bangalore’s Electronic City, with its registered office located in Hosur, Tamil Nadu.

For Q1 FY25, Titan reported a 5% year-on-year decline in net profit, affected by the financial costs associated with acquiring CaratLane. However, revenue from operations increased by 12.6% to ₹12,223 crore, with net profit standing at ₹715 crore for the quarter.

Price Action: Titan’s share price was down 0.34% at ₹3,763.10 on Thursday amid broader weakness in the market in early trade.

The stock has gained only 2.3% so far this year, lagging the Nifty 50, which has surged close to 17% in the same period.

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