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You are here : IndiaNotes >> Research & Analysis >> Companies >> Titan Company Ltd. >> Research

Titan Q3FY18: A very good quarter for Watches division; Overweight

Firstcall India Equity | 14 Feb, 2018  | Follow Author | Add to my Favourites 
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Highlights:

 

- Titan Company Ltd is engaged in manufacturing of watches, jewelry, precision engineering and Eyewear.


- Revenue for the quarter raised by 6.96% at Rs. 41365.70 mn from Rs. 38674.60 mn, when compared with the prior year period.


- During the quarter, EBIDTA is increased by 22.05% to Rs. 4631.40 mn from Rs. 3794.70 mn in the corresponding period of the previous year.


- During Q3 FY18, Profit before tax stood at Rs. 4233.30 mn as compared to Rs. 3466.40 mn in Q3 FY17, up by 22.12%.


- During Q3 FY18, net profit increased to Rs. 3082.10 mn from Rs. 2530.60 mn in Q3 FY17, higher by 21.79%.


- EPS of the company stood at Rs. 3.47 during the quarter, as against Rs. 2.85 per share over previous year period.


- Jewellery division had a very high base for the quarter. The retail growth for the quarter of 15%. The Company added 73 stores with a retails space of 75k sq feet in YTD December FY 17-18.


- Q3 was a very good quarter for Watches division and top line growth was 4.7%.


- For the 9M FY 18 the revenue rose by 23.79% at Rs. 114595.40 mn as against Rs. 92571.60 mn in the 9M FY 17.


- The PAT during 9M period of FY18 rose by 56.95% to Rs. 8807.60 mn from Rs. 5611.70 mn in the corresponding previous year period.


- Net Sales and PAT of the company are expected to grow at a CAGR of 17% and 24% over 2016 to 2019E respectively.


Outlook and Valuation


At the current market price of Rs. 802.75, the stock P/E ratio is at 62.59 x F Y18E and 53.21 X F Y19E respectively.


Earnings per share (EPS) of the company for the earnings for FY18E and FY19E are seen at Rs. 12.83 and Rs. 15.09 respectively.


Net Sales and PAT of the company are expected to grow at a CAGR of 17% and 24% over 2016 to 2019E respectively.


On the basis of EV/EBITDA, the stock trades at 40.05 x for F Y18E and 34.40 x for F Y19E.


Price to Book Value of the stock is expected to be at 13.08 x and 10.50 x for F Y18E and F Y19E respectively.


Hence, we say that, we are Overweight in this particular scrip for Medium to Long term investment.


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About Firstcall India Equity

Firstcall India Equity of Firstcall India Equity Advisors Pvt. Limited (FIEA), is a leading financial services provider in India and a SEBI Registered Category-I Merchant Banker. FIEA is a culmination of a credible Equity Research Capabilities, Long Standing Relationship with leading FIIs, DFIs, MFs, Overseas Pension Funds etc. The company’s research caters to the needs of the largest news wire and media houses of the world namely Reuters, Thomson, Capital IQ, Themarkets.com, Emerging Markets Euro money Publications-UK. The Company is among the major players in the Debt and Equity markets.


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Disclaimer: The author has taken due care and caution to compile and analyse the data. The opinions expressed above are only the views of the author, and not a recommendation to buy or sell. Neither the author nor IndiaNotes.com accept any liability whatsoever arising from the use of any of the above contents.




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