Titan shares slip 1% ahead of Q2 results today
Titan is set to release its July-September 2024 quarter results, with analysts predicting a potential 27% drop in net profit due to inventory losses from customs duty cuts. However, sales are expected to rise by 3%, fueled by a strong 25% growth i...
By ETMarkets.com | Updated:
Agencies
Shares of consumer discretionary major Titan fell by 1% in early trading today, hitting an intraday low of Rs 3,191.50 on the BSE ahead of the company’s quarterly numbers for the July-September 2024 period, which are due later today.
The company is expected to see a decline in profitability in the second quarter mainly on account of inventory loss due to customs duty cuts in the reporting period.
Net profit for the quarter is likely to fall up to 27% year-on-year in the July-September 2024 period, according to an average estimate of four brokerages. Meanwhile, net sales are seen rising 3% year-on-year in the same period, the estimates revealed.
Analysts are building in a 25% growth in core Jewellery segment, driven by both volume and price as even after the custom duty reduction, the increase in base gold price was about 28% YoY on an average for the quarter.
"For the jewellery segment margins, we build an 11% margin, given the focus on market share gains. Overall we expect, EBITDA Margins at 11.3% and EBITDA at Rs 1380 crore, up 2% YoY," said Nuvama.
For the Watches & Wearables segment, analysts are pricing 15% YoY growth in (Traction in wearables sustaining) and 5% growth in the Eyewear segment.
"Titan's FY2025E consolidated jewelry EBIT margin guidance band is 11.5-12.5%. We estimate 11% EBIT margin for watches and eyewear segments in 2QFY25," said Kotak Equities.
Motilal Oswal sees standalone Jewelry EBIT margin to remain stable YoY at 13.8% vs 14.1% in 2QFY24. "We expect healthy growth in watches and other business while muted growth in the eye care segment," it said.
Investor focus would be on recurring standalone jewellery EBIT margin (adjusted for impact of inventory loss pertaining to import duty cut and associated intermittent easing of competitive pressure that could have allowed better making charges/lower promotions).
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
The company is expected to see a decline in profitability in the second quarter mainly on account of inventory loss due to customs duty cuts in the reporting period.
Net profit for the quarter is likely to fall up to 27% year-on-year in the July-September 2024 period, according to an average estimate of four brokerages. Meanwhile, net sales are seen rising 3% year-on-year in the same period, the estimates revealed.
Analysts are building in a 25% growth in core Jewellery segment, driven by both volume and price as even after the custom duty reduction, the increase in base gold price was about 28% YoY on an average for the quarter.
"For the jewellery segment margins, we build an 11% margin, given the focus on market share gains. Overall we expect, EBITDA Margins at 11.3% and EBITDA at Rs 1380 crore, up 2% YoY," said Nuvama.
For the Watches & Wearables segment, analysts are pricing 15% YoY growth in (Traction in wearables sustaining) and 5% growth in the Eyewear segment.
ADVERTISEMENT
"Titan's FY2025E consolidated jewelry EBIT margin guidance band is 11.5-12.5%. We estimate 11% EBIT margin for watches and eyewear segments in 2QFY25," said Kotak Equities.
Motilal Oswal sees standalone Jewelry EBIT margin to remain stable YoY at 13.8% vs 14.1% in 2QFY24. "We expect healthy growth in watches and other business while muted growth in the eye care segment," it said.
Investor focus would be on recurring standalone jewellery EBIT margin (adjusted for impact of inventory loss pertaining to import duty cut and associated intermittent easing of competitive pressure that could have allowed better making charges/lower promotions).
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
Too busy to trade in stocks? Invest in Mutual Funds with ET Money!
Bookmark or read stories offline -
Download ET Markets APP
Download ET Markets APP
Related Articles
Why Rakesh Jhunjhunwala bought Titan shares when everyone else was selling? Raamdeo Agrawal explains2026-06-26T04:06:21Z- Real 'Made In India: A Titan Story' began in a small Tamil Nadu village with a mission to bring stylish watches to the common Indian2026-06-22T07:50:42Z
- Bid management firm ContraVault AI raises $3.1 million from Chiratae, Titan; eyes US expansion2026-06-16T14:51:45Z
ADVERTISEMENT
