Expecting 18% boom in Titan jewelry business: Naveen Kulkarni, Reliance Securities

Titan typically comes out with a launch about the quarterly overall performance. The sales numbers are already greater or less regarded, so there is probably a zero.Five% up or down in comparison to what we are waiting for.
We look forward to an 18% growth in the jewelry commercial enterprise. I do not think the numbers may deviate much from that. The vital aspect and the most important attention from the quarterly effects can be at the jewelry enterprise’s margins.

That is the key number to search for in those quarterly numbers because the margins have been appreciably excessive inside the base quarter. Whether they can deliver on those margins and whether margins can stabilize or amplify similarly goes to be the key quantity to watch out for in this area. Apart from that, the other segments also are doing moderately well. The most effective issue can be the growth in terms of profitability and running profit numbers.


Can I properly say that Titan may experience the heat inside the cutting-edge and subsequent two quarters? You cannot have a scenario where vehicles are slowing down, patron discretionary is slowing down, and human beings aren’t shopping for cleaning soap and shampoo, but they will preserve to shop for jewelry. Yes, that could very an awful lot happen because the whole slowdown in the intake % isn’t apparent. So, until mid-February, things were not so terrible or had been fairly okay. Post-February, matters commenced looking pretty slow. It has panned out, and whether elections are a reason for that, there’s no splendid historic priority to help this or a structural slowdown that we witness in the intake area.

We get clarity on that during some other sector or so. But as of now, if the slowdown is greater structural, then Titan will also begin feeling the warmth in 1 / 4 or so. Can a number of the client names get into each time and charge correction because PE multiples are multiplied? See what normally takes place with intake shares or stocks that do not need a great deal of capital to run their corporations is until and until there may be an extreme compression in margins; allow us to say Hindustan Unilever is at 23% sort of an EBITDA margin, and if the margins have been to begin compressing pretty a piece from the modern-day ranges, then we are going to see a critical compression in PE.

Otherwise, it is more likely to be a time correction where the inventory might be sideways in, let us say, plus to minus five-6% kind of a sector. But we can begin seeing compression in margins due to the rising aggressive intensity and a slowdown where they may be unable to take rate hikes and then the cost shape transferring up. In contrast, PE compression will sincerely happen. If that does not show up, margins will remain solid for the intake and customer corporations. We are more likely to peer the PE stay in the band. There might not be a great PE correction.

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