Rakesh Jhunjhunwala stock: brokerages bullish on this Tata Group stock; upgrade counter, raise target prices

Titan Company Limited posted robust results in the quarter ended on June 30, 2022. The Tata Group company's profit jumped multifold year on year, while total income grew by almost 200% in the April-June quarter. The strong performance was driven by robust 3x sales growth in the jewellery business, 2.6x growth in the watches business and 2.8x growth in the eyecare business.

Titan is one of the 32 stocks held by billionaire investor Rakesh Jhunjhunwala in the June quarter. The celebrity investor holds 5.1 stake or 44,850,970 shares in his favourite company. At the current market price, the value of Titan shares in Jhunjhunwala's portfolio comes a little over 10,500 crore as on August 8.  

Brokerge houses have been bullish on the counter since this Tata Group company came out with Q 1 results.  

Titan is aiming to grow its revenue at CAGR of over 20% over FY2022-27 on back of its ambitious growth plan in the medium term, said domestic brokerage Sharekhan. This along with consistent improvement in margins will help cash flows improve strongly in the coming years, it said.  

The brokerage feels the company’s strong growth outlook, industry tailwinds in the medium term and strong balance sheet makes it a best play in the retail space.  

Sharekhan maintained a buy recommendation on the stock with an unchanged target price of Rs 2900. 

Likewise, JP Morgan, which too feels Titan is a preferred pick in discretionary space, upgraded the stock from neutral to overweight. It raised target price from RS 2400 to Rs 2800.  

Macquarie maintained an 'Outperform' rating with an increased target price of Rs 2900, previously Rs 2800. It said Quarter one pointed to healthy watch/eyewear margins. Its jewellery demand was also barely hit from custom duty hike. 

Citi retained its buy rating on Titan, while raised the target price to Rs 2970 from Rs 2890.  

Titan Q1 results 2022:  

The Tata Group company has recorded its second-best quarterly revenue in Q1FY23, buoyed by a strong festive demand in a near normal Ql that came after a gap of two Covid disrupted periods of Ql FY21 and Ql FY22, the company said in its filing to exchanges.  

Titan Q1 FY23 net profit jumped to Rs 793 crore as compared to Rs 61 crore in the same quarter last year. Besides, its total revenue from operations surged to Rs 8,961 crore against Rs 3,249 crore year-on-year (YoY). 

Titan recorded one of the highest profits of Rs 1,066 crore (before taxes) for the quarter in comparison to Rs 82 cr in Ql FY22. Total income for the quarter was at Rs 8,649 cr, which was up nearly 200 per cent as compared to Rs 2,890 cr of Ql FY22 (excluding bullion sale). 

Meanwhile, after posting strong results on every front on Friday, shares of Titan jumped one per cent to Rs 2474.95 per share in BSE intraday trade on Monday.