Titan shines bright
It’s a good day for Titan; apart from the robust earnings for Q1FY25, the rising gold prices has also added the glimmer.
First the consolidated financial highlights – Q1 FY26 (YoY)
- Revenue: Rs.13,570 crore, up 19%
- EBITDA: Rs.1,705 crore, up 22%
- EBITDA Margin: 12.6% vs 12.2%
- Net Profit: Rs.1,115 crore, up 24%
- EPS: Rs.12.5 vs Rs.10.1 YoY
- Jewellery segment revenue grew 21%
- Watch and wearables rose 14%
- Eyewear grew 11%
- Taneria (ethnic wear) grew 39%
And the impact of rising gold prices - Gold prices in India are trading near all-time high level today, with 24-karat gold reaching Rs.1.02 lakh per 10 grams. This rise reflects both global and local factors, including US trade tariffs and expectations of a rate cut by the US Federal Reserve.
When gold prices rise gradually, Titan is often seen as a beneficiary due to inventory gains and premium positioning. But if the rise is sharp and abrupt, expect short-term demand softness and volatility in margins.
Titan holds significant gold inventory. When gold prices rise, its mark-to-market value of inventory increases, which in turn improves gross margins and EBITDA, especially if older inventory was purchased at lower prices. Though there maybe a short dip in demand, as gold becomes expensive, ticket size of each sale rises (even with same volume). So revenues may grow even if volume is flat.
The stock price of Titan is up in the green today; from its close of Rs.3414.95, it opened higher at Rs.3449 and rose to an intraday high at Rs.3478.25. Its 52-week high is at Rs.3866.15.