Titan share price falls 3% after disappointing Q2 results. Buy or sell?

At 11:15 am, shares of Titan were down 2.80% at Rs 3,142.50 on the Bombay Stock Exchange (BSE).

In Short

• Titan shares drop 3% after weak Q2 earnings report
• Company's jewellery segment margins disappoint, full-year guidance lowered
• Long-term outlook remains positive despite short-term pressures

Shares of Titan Company dropped over 3% on Wednesday after the company’s second-quarter earnings report fell short of expectations. Despite a 26% rise in total income to Rs 13,660 crore, Titan’s net profit slumped 23% to Rs 704 crore, missing the street’s forecast.

At 11:15 am, shares of Titan were down 2.80% at Rs 3,142.50 on the Bombay Stock Exchange (BSE).

A key factor behind the stock's decline was the weak performance in its jewellery segment, where margins were hit harder than anticipated.

Titan’s jewellery division, which accounts for a large part of its business, reported disappointing margins, prompting the company to lower its full-year guidance by 100 basis points.

The cut in customs duties, while aiding jewellery growth, weighed on margins, with analysts pointing to an inferior product mix—especially fewer high-margin studded jewellery items—as another drag.

BUY OR SELL TITAN SHARES?

Jefferies expressed concern about Titan’s short-term outlook, stating, "The management commentary on demand was reasonably positive, although the cut in jewellery margin guidance would be viewed negatively, partly due to weak demand for solitaire."

As a result, Jefferies slashed its target price for Titan to Rs 3,400 from Rs 3,600 and revised its EPS estimates down by 3-7%.

Goldman Sachs also downgraded its outlook, cutting its FY25 EPS estimates by 8.7% due to weaker-than-expected jewellery margins.

The brokerage lowered its target price for Titan to Rs 3,650 from Rs 3,750 but retained its ‘Buy’ rating.

Goldman Sachs also noted a one-off loss of Rs 550 crore from the gold hedging mechanism, though it sees no lasting impact on Titan’s profits in FY26 or FY27.

With competitive pressures and moderating jewellery margins in the near term, Titan shares may face a bumpy road ahead.

However, analysts still see potential in the long term, with Titan’s strong market position and brand recognition continuing to support its outlook. Investors may want to remain cautious in the short term but could consider long-term opportunities as the stock recovers.

(Disclaimer: The views, opinions, recommendations, and suggestions expressed by experts/brokerages in this article are their own and do not reflect the views of the India Today Group. It is advisable to consult a qualified broker or financial advisor before making any actual investment or trading choices.)