Titan shares give Rs 900 crore shock to Jhunjhunwalas. What brokerages say on Tata's bluechip stock
ADVERTISEMENT The Jhunjhunwala family holds a 5.15% stake in the Tata Group company. The selloff comes just days after another high-PE Tata stock, Trent, disappointed investors with lower-than-expected revenue growth, reigniting concerns about premium valuations in the consumer space.
The damage was most pronounced in Titan's core jewellery business, where domestic revenue growth of just 18% year-on-year fell significantly short of Street estimates of 22–23%. The company's flagship brands—Tanishq, Mia, and Zoya—posted even weaker growth of 17%, excluding bullion sales.
'Q1 Tanishq, Mia & Zoya business revenue (ex-bullion) up 17% YoY vs est. of 28% YoY,' Morgan Stanley noted in a research report. While the brokerage maintained its Overweight rating on the stock, it flagged the sharp miss in jewellery segment performance.
Also Read | Titan shares tumble 5% after Q1 business update fails to impress D-Street
The brokerage set a target price of Rs 3,876, citing gold price volatility as a key factor that led to softer consumer purchases between May and mid-June.Gold prices surged approximately 35% in Q1FY26, with a steep 15% spike within the quarter itself, creating a perfect storm for jewellery retailers. The volatility particularly impacted consumer behaviour between May and mid-June, leading to a slowdown in purchases despite some traction during the Akshaya Tritiya period.
ADVERTISEMENT "In the high gold rate scenario, customers preferred lightweight and lower karatage jewellery," the company said, noting that buyer growth remained flat year-on-year for both its premium TMZ brands and its online platform, CaratLane.
ADVERTISEMENT CLSA maintained an Outperform rating with a target price of Rs 4,326, acknowledging that while the consumer business grew 20% year-on-year—below estimates—the overall sales performance was resilient given the exceptional gold price surge and geopolitical tensions during the quarter.
However, Emkay Global turned bearish, maintaining a Reduce rating with a target price of Rs 3,350.
ADVERTISEMENT "Given the risk to estimates, increasing competition, mushrooming LGD players, and a deteriorating RoIC profile, we maintain 'Reduce' on Titan with a target price of Rs 3,350 (50x Jun-27E EPS)," the brokerage stated.
JM Financial expects jewellery EBIT margin to compress to 11% (ex-bullion sales), down roughly 20 basis points year-on-year, and projects standalone EBITDA/PAT growth of 20%/19% YoY. The pressure on high-margin studded jewellery sales—which grew only in low double digits—further weighed on margins. "With low footfalls at stores, the high-margin studded sales are also under pressure, which typically see better traction during periods of rising gold prices," Emkay added.
ADVERTISEMENT Beyond gold price volatility, Titan is facing growing competitive pressure with the entry of new players like Indriya in select markets, along with expansion by existing rivals. The company is responding by narrowing the gap in gold pricing and making charges versus competitors, while also pushing gold exchange programs and monthly instalment schemes to sustain business.Like-for-like domestic growth for Tanishq, Mia, and Zoya remained in the low double digits, driven entirely by an increase in average ticket size rather than new customer additions. The company added 19 new stores in India during the quarter—3 under Tanishq, 7 under Mia, and 9 through CaratLane.
The steep decline in Titan shares underscores the vulnerability of high-PE consumer stocks to earnings disappointments, especially as investors begin to reassess premium valuations amid a challenging operating environment.
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