Titan shares dip 6% despite strong Q1 growth, broker views

On Tuesday, shares of Titan Company, which is part of the Tata Group, fell by almost 6 per cent. This happened even though the company reported good growth in its consumer business during the first quarter of the financial year 2025-26 (Q1FY26). Many experts and brokerages still feel positive about Titan’s performance and believe it will do well in the coming months.

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What Did the Brokerages Say?

Several major brokerage firms shared their views on Titan after its Q1 results.

• Citi, an international brokerage, has kept a neutral rating for Titan shares. It has set a target price of ₹3,800. A neutral call means they think the stock will perform in line with the market average.

• CLSA, another global brokerage firm, has given an outperform rating to Titan. It has kept a target price of ₹4,236. This means they expect Titan’s stock to perform better than other stocks in the same sector.

• Motilal Oswal, a well-known Indian brokerage, has continued its buy rating on Titan. They have set a target price of ₹4,250. This indicates they think the stock has strong potential to grow from its current price.

• Morgan Stanley, another global investment firm, has kept an overweight rating on Titan with a target price of ₹3,876. Overweight means they believe Titan’s stock will do better than other stocks in their portfolio. However, they said that Titan’s jewellery segment growth in the June quarter was below their expectations.

Jewellery Business Performance

Titan’s jewellery business, which includes popular brands like Tanishq, Mia, and Zoya (known as TMZ collectively), saw a like-for-like (LFL) domestic growth in low double digits. This means that sales grew by around 10-12 per cent compared to the same stores last year. This growth was mainly because the average spending by customers (ticket size) increased.

However, the total jewellery business growth was 18 per cent year-on-year. Analysts had estimated it to grow around 22 per cent y-o-y, so it missed expectations slightly. The company said that the rise and fall in gold prices affected people’s buying decisions, and this impacted their jewellery sales during the quarter.

Gold Prices and Their Impact

In recent months, gold prices have gone up globally. When gold prices rise, customers sometimes wait for prices to come down before making big jewellery purchases. Titan mentioned that this trend impacted consumer sentiments in the quarter, especially for large ticket-size jewellery items.

Watches Business Performance

Titan’s domestic watches business performed very well. It grew by 23 per cent compared to last year. The growth came from strong sales in analog watches, both in terms of how many pieces they sold and the value they earned.

Two brands did particularly well:

• Sonata, which saw high demand due to its new refreshed designs.

• Titan watches, which continued their strong performance in the Indian market.

Eyewear Business Growth

Titan’s EyeCare business (which includes their eyewear stores and e-commerce) grew by 12 per cent year-on-year. This was because of good sales across their physical stores and online platforms. People are buying more branded spectacles and sunglasses, which is helping the business grow steadily.

Other Businesses Perform Well

Titan has some emerging businesses apart from jewellery, watches, and eyewear. These businesses also showed strong growth:

• Fragrances (perfumes and deodorants): Sales went up by 56 per cent y-o-y.

• Women’s bags segment: Sales rose by 61 per cent y-o-y, showing that Titan’s new bag collections are getting popular.

• Taneria, Titan’s ethnic saree brand, saw a 15 per cent increase in revenue compared to last year.

International Business Expansion

Titan is not just growing in India. Its international business grew by 49 per cent year-on-year. The biggest highlight was Tanishq’s business in the United States, which almost doubled in size. This shows that Indian jewellery is becoming popular among Indian-origin customers and others abroad.

What Happened to Titan’s Share Price?

Despite all these good growth numbers, Titan’s share price fell by nearly 6 per cent on Tuesday. At 10:05 am, the stock was trading 5.20 per cent lower at ₹3,476.30 on the Bombay Stock Exchange (BSE). It even touched an intraday low of ₹3,457.25 during the day. On Monday, it had closed at ₹3,666.85.

Why Did the Shares Fall?

The main reason for the fall was that investors were expecting higher growth in the jewellery segment. Since jewellery is Titan’s largest business, any slowdown in its growth affects overall market sentiment about the company. Even though other businesses like watches, eyewear, and fragrances grew well, the slightly lower-than-expected jewellery growth led to the share price drop.

To sum up:

• Titan’s consumer business grew by 20 per cent in Q1FY26, showing strong overall demand.

• Jewellery growth was slightly below estimates, mainly due to gold price volatility.

• Watches, eyewear, fragrances, and bags saw good growth, supporting overall performance.

• Brokerages remain positive, with most having target prices above current market levels.

• International expansion, especially in the US, is becoming a strong growth pillar.

Titan continues to be one of India’s most trusted lifestyle companies. Experts believe that as gold prices stabilise, its jewellery sales will improve further. Its focus on new products, digital growth, and international markets is expected to keep Titan strong in the coming years.