Titan Company Ltd has emerged as a top performer in 2025, with its stock price surging 10% year-to-date, despite a 2% decline in the BSE Sensex. This stock remains a significant holding in the portfolio of the late Rakesh Jhunjhunwala, with his family retaining a 5.14% stake as of December 31, 2024.

Muted Profit Growth Despite Strong Sales

Titan’s Q3 performance showcases strong revenue growth but with muted profit expansion. The Tata Group-owned jewellery giant recorded a 26% year-on-year (YoY) growth in its jewellery segment (excluding bullion sales), driven by festive and wedding season demand. The company also witnessed a high-single-digit increase in buyers and a double-digit rise in the average ticket size.

Brokerage Estimates: Mixed Projections

• IIFL Securities: Profit estimated at Rs 1,121 crore (+6.5% YoY), revenue at Rs 16,793 crore (+18.6% YoY), jewellery EBIT margin at 11.5%.
• InCred Equities: Profit projected at Rs 1,111 crore (+5% YoY), sales at Rs 17,530 crore (+23.8% YoY), EBITDA at Rs 1,753 crore (+12% YoY).
• Nuvama Institutional Equities: Standalone profit forecasted at Rs 1,023 crore (-2% YoY), revenue at Rs 16,168 crore (+24% YoY), EBITDA margin expected at 10% (-110 bps YoY).
              

Gold Prices and Custom Duty Impact

Gold prices soared 30% YoY in rupee terms, positively impacting Titan’s jewellery segment. The company continued its store expansion strategy, surpassing its internal guidance in multiple regions. However, analysts caution that custom duty cuts may result in temporary inventory losses, slightly impacting margins.

Jewellery Segment Drives Titan’s Growth

Titan’s domestic jewellery business remained the primary growth driver, reflecting a 26% YoY surge similar to Q2. The studded jewellery category posted a 22% growth, fueled by an increasing number of high-value purchases. Analysts predict the EBIT margin for the jewellery segment to hover around 12%, excluding inventory-related adjustments.

Conclusion: Titan’s Market Position & Future Outlook

Titan’s robust sales growth and aggressive market expansion reinforce its position as a leading jewellery brand. While margin pressures may persist in the short term, its focus on premium offerings and market share expansion ensures long-term profitability. Investors will closely monitor Titan’s Q3 earnings for insights into future market trends.