Analysts said rising gold prices could dent demand for Titan’s products. “There is a notable and sudden rise in gold prices (+15%) over the last two months which is impacting footfalls/growth and also gross margins/mix,” said Bank of America in a client note. “We see gold price volatility as a key variable to monitor; as seen historically, stability/gradual gold price change bodes well for demand.”
Citi Research said it expects the stock to remain under pressure in the near term amid intensified competition and softer demand.
“Aggressive store expansion by existing players and entry of new player (e.g., Novel Jewels by Aditya Birla Group will invest ₹5,000 cr) may keep competitive intensity elevated,” said Citi’s analysts in a client note.
JP Morgan said despite the share’s outperformance in the past year and gold price-led volatility and margin concerns, which could weigh on the near-term share prices, it expects mid-high teens revenue growth over the medium term.