Share of Titan declined nearly 3 per cent to hit an intraday low of Rs 1,717.55 on BSE after the company reported its Q1FY22 business update.
The stock opened 0.23 per cent higher at Rs 1,767.45 against the previous close of Rs 1,763.30 on BSE. However, it shed all early gains and slipped in the red. Market cap of the firm fell to Rs 1,53,915.49 crore.
The stock has gained 71 per cent in the last one year and risen 11 per cent since the beginning of this year. The share stands higher than 50 day 100 day, 200 day moving averages and lower than 5 day, 10 day and 20 day moving averages.
The company said it entered the quarter with a good sales momentum. The sales were hit only to a small extent until the third week of April, from the rapidly rising second wave of the pandemic, primarily due to the temporary store closures in some important states.
“The sales recovery is gradually improving across the businesses, along with the increase in the store operational days. This year, Watches & Wearables and Eyewear segments have also witnessed rapid recovery in walk-ins with the re-opening of stores, which was seen in only Jewellery division last year,” it added.
Titan recorded revenue growth of 117% (excluding bullion sales) in Q1 FY22, with a revenue contribution of 50%, 10% and 40% coming from April, May and June months respectively.
For the quarter ended on 30th June, the jewellery division grew by 107% (excluding bullion sales), compared to last year, primarily due to zero sales in April of last year. Most of the sales of May month was lost in both the years.
The company informed that the Watches & Wearables division grew by 280% over Q1’21 as sales were nil in April month of last year and the recovery this year has been faster than that witnessed last year when footfalls in stores were very weak due to higher apprehension of covid. North & West regions had recovered earlier, following the pattern of the pandemic wave in the country.
Recovery in higher ticket products is much better compared to the recovery in lower-priced products. Like last year, the recovery in smaller towns was better than the top 8 metros
The eyewear division grew by 117% over Q1’21 as sales were nil in April month of last year and also on the back of a rapid recovery in walk-ins in May and June months, compared to last year.
CLSA noted the company had muted topline recovery on a year-on-year basis. The brokerage house has a ‘Sell’ rating with a target price of Rs 1,370 per share.