Titan Company set to gain from jewellery formalisation and store expansion

Investment View and Valuation

In its September 10, 2026 company update, Motilal Oswal Financial Services Limited reiterated its Buy recommendation on Titan Company. The broker’s positive view is based on Titan’s ability to gain jewellery market share as the Indian jewellery industry formalises, supported by store expansion, a multi-format portfolio, established brand equity and its historical execution record.

Motilal Oswal has a target price of Rs6,000, implying 20 per cent upside from the report CMP of Rs5,000. The target price is based on 60 times September 2028 estimated EPS.

Management Outlook and Jewellery Expansion

Management, represented by CFO Ashok Sonthalia in the broker meeting, remained constructive on the long-term jewellery opportunity. Titan Company’s jewellery market share increased to 8.5 per cent in FY26 from 4.5 per cent in FY19, and management is targeting about 11 per cent by FY30.

Titan plans to expand its jewellery network, excluding CaratLane, from 824 stores in FY26 to 1,400 stores by FY30. Management remains confident of its FY30 objective of about 20 per cent consolidated revenue CAGR over FY26 to FY30, driven by higher execution intensity, and is comfortable sustaining jewellery EBIT margin at around 11 per cent over the medium term.

Demand Trends and International Strategy

Demand was reported to be healthy and in line with 1QFY27 trends, with improving buyer growth and festive purchases gaining traction across regions. Management cited rising Dhanteras-related jewellery purchases in South India as evidence of a broader regionalisation of festive demand.

Internationally, Tanishq is focusing on localisation; Indian customers currently account for 80-85 per cent of its overseas customer base. The report identifies stable gold prices as a potential support for better margin visibility.

Industry Formalisation and Competitive Positioning

Motilal Oswal views industry formalisation as a long-duration structural opportunity. Organised retailers account for only 40-45 per cent of the approximately Rs8,50,000 crore Indian jewellery market, compared with 20-25 per cent in FY19. Despite being the largest player, Titan’s 8.5 per cent market share leaves material room for branded players to gain share.

The broker believes Titan’s sourcing capability, higher studded-jewellery focus, youth-centric positioning and reinvestment strategy give it superior competitive positioning versus branded peers.

Financial Performance and Forecasts

For FY26, Titan Company reported consolidated sales of Rs87,580 crore, up 44.9 per cent year on year, EBITDA of Rs8,360 crore, up 34.0 per cent, and reported PAT of Rs5,070 crore. Jewellery represented 90 per cent of FY26 segment sales, with jewellery sales of Rs79,660 crore and jewellery EBIT of Rs7,210 crore.

Across FY26 to FY29E, the broker models 17 per cent sales CAGR, 21 per cent EBITDA CAGR and 23 per cent adjusted PAT CAGR.

Jewellery and CaratLane Forecasts

Within jewellery, Motilal Oswal forecasts standalone jewellery sales excluding bullion to grow 26 per cent in FY27E, followed by 17 per cent in FY28E and 16 per cent in FY29E.

The broker’s thesis depends on continued formalisation, sustained demand, successful network expansion, share gains and jewellery-margin resilience.