- Why Titan Share Is Falling
- Valuation Premium Under Pressure
- Brokerages React
- What’s Ahead for Titan?
Titan shares fell nearly 6% on July 8, 2025, after the company reported a weaker-than-expected business update for Q1FY26. A miss in the jewellery segment, which contributes the majority of Titan’s revenue, raised concerns around slowing demand, high gold prices, and stretched valuations.
Why Titan Share Is Falling
The stock declined over 6% intraday on July 8, closing at ₹3,440. The fall led to a loss of over ₹18,000 crore in investor wealth in a single trading session.
The sharp correction followed Titan’s Q1FY26 business update, which showed slower-than-expected growth in the jewellery segment. This segment accounts for nearly 90% of Titan’s overall consumer revenue.
Jewellery Growth Misses Estimates
Titan reported 18% year-on-year growth in its India jewellery business, including bullion sales. This was below Street expectations of 22–23%. Excluding bullion, growth stood at 17%, significantly lower than Morgan Stanley’s estimate of 28%.
| Metric | Actual | Expected | What It Covers |
|---|---|---|---|
| Jewellery (India, incl. bullion) | 18% YoY | 22–23% | All jewellery sales in India, including gold coins and bars |
| Jewellery (India, ex-bullion) | 17% YoY | 28% | Core jewellery demand excluding investment gold |
The lower growth in core jewellery demand, excluding investment gold, suggests a slowdown in customer purchases during the quarter.
Gold Price Spike Impacted Demand
Gold prices rose sharply, up 35% year-on-year, with a 15% surge during Q1, making buyers more cautious. Titan noted a shift in customer behaviour, with increased preference for lighter, lower-karat jewellery.
While average ticket sizes rose, overall customer growth remained flat, indicating that growth was driven more by higher prices than volume expansion.
Valuation Premium Under Pressure
Titan currently trades at a price-to-earnings (PE) ratio of 92.4x, making it one of the most expensive consumer discretionary stocks. The Q1 miss has brought valuation concerns to the forefront, especially when compared to peers:
Kalyan Jewellers: 83.3x
PN Gadgil: 37.5x
PC Jeweller: 19.2x
Titan’s rich valuation despite subdued growth has drawn comparisons to Trent, another high-PE Tata Group company that faced a similar market reaction recently.
Brokerages React
Morgan Stanley
Rating: Overweight
Target Price: ₹3,876
View: Described the jewellery growth as a “significant miss” and highlighted gold price volatility as a key reason for softer demand from May to mid-June
Emkay Global
Rating: Reduce
Target Price: ₹3,350
View: Pointed to rising competition, weaker return on invested capital (RoIC), and margin pressure in studded jewellery
What’s Ahead for Titan?
- Short-term pressure from gold prices: Volatile gold prices (up 35% YoY) are impacting consumer sentiment, particularly in high-ticket and studded jewellery
- Valuation sensitivity remains high: At over 90x PE, the stock is vulnerable to even minor earnings disappointments
- Festive season performance will be key: Q2 and Q3 sales during major festivals will be closely watched for signs of demand recovery
- Product mix needs adjustment: Increasing the share of higher-margin studded jewellery may be necessary to support margins amid changing customer preferences
- Competition is intensifying: Regional and value-focused jewellers continue to expand, raising pricing and margin pressures
- Execution is critical: Titan remains a market leader, but maintaining its valuation premium will require consistent performance and a recovery in volume-led growth.
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