Titan Company share price is likely to be adversely affected in the future too after Finance Minister Nirmala Sitharaman made provisions to raise import duty on gold and precious metals to 12.5 per cent, from current level of 10 per cent in her maiden Budget speech on July 5. Picture for representational purpose (Photo: Twitter\@kumarmangla)
Titan Company share price came under pressure today after the consumer durables firm said it faced a tough macro-economic environment with consumption taking a hit in the first quarter of this fiscal. The fall comes ahead of India Inc starting its earnings seasons for Q1 with IT behemoth TCS set to announce its earnings later today.
The company's quarterly update which shows high gold prices in June hitting growth in its jewellery segment signals lowering of expectations from the luxury goods maker when it will announce earnings for the quarter ended June this fiscal.
Titan Company share price fell up to 14.37% to 1,072.60 level compared to the previous close of 1,252 on BSE. Titan Company share price is likely to be adversely affected in the future too after Finance Minister Nirmala Sitharaman made provisions to raise import duty on gold and precious metals to 12.5 per cent, from current level of 10 per cent in her maiden Budget speech on July 5.
The hike in import duty is likely to make gold costlier. This is a huge negative for listed companies dealing in jewellery.
The share price will also be affected by Q1 earnings in the current fiscal. Here's a look at what brokerages have to say on the movement and target for Titan share price in future.
Motilal Oswal Securities on Titan
Company management stated that growth, particularly in jewellery segment, was lower than planned in 1QFY20. Consequently, the brokerage has lowered earnings per share estimated by 2.7% and 1.8% for FY20/21. Maintain Buy position with revised target price of Rs 1,500.
Morgan Stanley on Titan
The brokerage said growth moderated in core jewellery business more sharply than their expectations. The reported growth likely implies flat- to low-single digit revenue growth in month of June with same-store sales decline. Stock is expected to trade weaker in the near term. The brokerage has given a target price of Rs 1,300 on the stock.
Credit Suisse on Titan
The firm's stretched valuations and near term softness limit upside for the stock. The brokerage is positive on medium-term on the stock. It has downgraded the stock to neutral with a target price of Rs 1,250. It has lowered earnings estimates by 2% and advised investors to look for a better entry point in the stock.
Edited by Aseem Thapliyal