Titan shares up ahead of Q1 results; here’s what to expect

Shares of Titan Company advanced over 1 per cent in Monday’s early trade ahead of the company's financial results for the quarter ended June 30 later in the day.

The scrip was up 1.07 per cent at Rs 1,102.40 on the BSE, while the benchmark Sensex traded 0.81 per cent higher at 38,347.

There are expectations that the company’s top line may take a hit due to the nationwide lockdown during the quarter, higher gold prices and limited big ticket spending by customers.

Motilal Oswal Financial Services sees a 65 per cent YoY drop in revenue of Titan Company. “We anticipate the watches division to be impacted the most (around 92 per cent dip YoY), followed by eyewear (85 per cent fall) and jewellery (down 70 per cent)

However, the brokerage expects bounce back in jewellery demand on the back of festive buying, wedding or occasion-based purchases.

An assessment by Prabhudas Lilladher shows a 96.60 per cent YoY drop in adjusted profit after tax on 63 per cent fall in sales. EBITDA is likely to drop 82.20 per cent YoY.

“We expect 80 per cent decline in jewellery volume as stores were closed for April. Jewellery margins take a hit due to high gold prices and imperfect hedge on gold prices. We estimate 80 per cent decline in watch sales,” Prabhudas Lilladher said.