Rakesh Jhunjhunwala Portfolio stock: Know Technical and Fundamental analysis of the largest holding of the Big Bull - Titan

Rakesh Jhunjhunwala Portfolio stock: ICICI Securities says Titan should be bought in the range of Rs 1465 – Rs 1490 with stop loss of Rs 1378 and target of Rs 1675. Titan Company is a major player in the organised jewellery market with share of 6%. Tanishq’s penetration is still at a very nascent stage in the Indian jewellery market. Titan share price closed at Rs 1506, Up Rs 55 or 3.8%.

This provides immense opportunity for Titan to enhance its market share, going forward. Recent regulatory changes such as gold hallmarking, GST have turned out to be highly favourable for organised players like Titan, leading to market share gains from unorganized players. The market share gains are visible as Tanishq reported robust revenue CAGR of 19% in FY16-20. Titan is the largest shareholding in ace investor Rakesh Jhunjhunwala's Portfolio. 

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Since the outbreak of the pandemic, perception of gold as an asset class has seen healthy traction. Demand for plain gold jewellery, gold coins has zoomed owing to a surge in gold prices. Titan is among few discretionary companies in ICICI Securities coverage to have reverted back to heathy sales growth. Titan’s jewellery division witnessed strong revival with revenue growth of 16% YoY in Q3FY21. Revenue trajectory accelerated further in January with jewellery division seeing 28% YoY growth driven by 16% growth in studded ratio.

The healthy growth revival depicts the inherent strength of the Tanishq brand and continuous focus on market share gains. Furthermore, a revival in share of studded ratio augurs well for overall margin profile. Titan’s ‘War on Waste’ programme is well on track with tight control on inventory position and higher focus on gold on lease replenishment (56% of inventory). ICICI Securities expect initiatives to improve cash positions and significantly enhance RoIC (from 31% in FY20 to 42% in FY23E). ICICI Securities build in revenue and earnings CAGR of 14% and 22%, respectively in FY20-23E.