Titan Company
BSE SENSEX
33,686
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
Avg Val, INRm/ Vol m
Free float (%)
S&P CNX
10,453
TTAN IN
887.8
875 / 13.0
1006 / 460
-3/19/85
1662.0
47.1
10 May 2018
4QFY18 Results Update | Sector: Retail
CMP: INR973
TP: INR1,150 (+18%)
Buy
Margin expands strongly led by Jewelry; more upbeat commentary
Titan’s 4QFY18 reported revenue (incl. other operating income) rose 13.3%
YoY
to IN41.1b (est. of INR40.4b). EBITDA grew 70.3% YoY to INR4.4b (est. of
INR3.6b) and recurring PAT rose 72.2% YoY to INR3.1b (est. of INR3.0b).
Consol. segmental performance:
a) Reported Jewelry sales were up 14% YoY to
INR33.6b, with segmental margin up 360bp YoY to 12.6%. b) Watches sales
declined 3% YoY to INR4.9b, with EBIT margin up 250bp YoY to 3.5%.
Gross margin expanded 110bp YoY to 29.4%,
while EBITDA margin inched up
350bp YoY to 10.6% (est. of 9.0%) in 4QFY18.
FY18 consol. performance:
Net sales were up 21.6%, EBITDA was up 42.3% and
PAT rose 39.9% YoY. EBITDA margin expanded 150bp to 10.2%. Jewelry sales
grew 24.3% to INR130b, largely in line with the 25% guidance at the beginning
of the year. Watches sales grew 3.6% YoY to INR21b, with growth appearing
muted due to the GST effect.
Concall highlights:
1)
Wedding and high-value diamond jewelry is now around
33% of sales.
2)
Golden Harvest Scheme was 14% of sales in FY17, which
increased to 17% in FY18 and management expects a further improvement.
Valuation view:
Management’s increasing confidence on Jewelry is reflected in
its revised strong guidance of 20% CAGR for the next five years, sharply
increased store expansion target of 40, and commentary about further margin
expansion because of operating leverage. Recent developments in the sector
are only strengthening the case for rapid growth of the Tanishq business. Our
EPS forecasts are up by 4.3%/5.8% for FY19/20. Stretched valuations are fully
deserved for a business that has perhaps the best top-line growth potential in
the large cap FMCG/retail space. Moreover, the improving margins outlook
drives our earnings growth expectations higher. Maintain
Buy
with a target
price of INR1,150 (INR1,090 earlier), based on 55x Mar’20E EPS (at a 30%
premium to three-year average P/E).
(INR Million)
FY18
2Q
3Q
34,731 42,748
29.6
8.3
30,750 38,524
3,981
4,224
50.6
21.2
11.5
9.9
310
349
145
109
446
213
3,972
3,979
1,189
1,159
29.9
29.1
2,783
2,820
64.6
21.0
FY17
4Q
41,072
13.3
36,718
4,355
70.3
10.6
360
167
185
4,013
893
22.3
3,120
72.2
130,567
17.3
119,012
11,555
32.4
8.8
1,105
377
705
10,777
2,760
25.6
8,017
12.8
FY18
158,403
21.3
142,194
16,209
40.3
10.2
1,314
529
1,127
15,492
4,279
27.6
11,213
39.9
FY18
4QE
40,384
17.7
36,753
3,631
33.4
9.0
242
75
308
3,622
589
16.3
3,033
49.5
Var.
Financials & Valuations (INR b)
Y/E Mar
2018
2019E 2020E
161.2
197.3
239.0
Net Sales
16.4
21.0
26.1
EBITDA
11.0
14.7
18.5
PAT
12.6
16.6
20.9
EPS (INR)
39.5
31.7
25.9
Gr. (%)
64.0
67.1
BV/Sh (INR) 57.3
23.9
27.4
31.9
RoE (%)
24.6
28.0
32.7
RoCE (%)
77.2
58.6
46.6
P/E (x)
17.0
15.2
14.5
P/BV (x)
Estimate change
TP change
Rating change
Quarterly Performance
Y/E March
Net Sales
YoY Cha nge (%)
Tota l Exp
EBITDA
EBITDA Growth %
Ma rgi ns (%)
Depreci a ti on
Interes t
Other Income
PBT
Ta x
Ra te (%)
Adjusted PAT
YoY Cha nge (%)
E: MOSL Estimates
1Q
28,026
4.3
25,157
2,869
43.8
10.2
263
88
134
2,652
468
17.7
2,184
44.1
FY17
2Q
3Q
26,799 39,484
1.0
16.2
24,157 35,998
2,643
3,486
44.4
24.0
9.9
8.8
278
289
120
79
107
166
2,351
3,283
660
952
28.1
29.0
1,691
2,331
15.6
3.1
4Q
36,258
51.6
33,700
2,557
22.5
7.1
275
90
298
2,491
680
27.3
1,811
-3.1
1Q
39,851
42.2
36,202
3,649
27.2
9.2
295
108
283
3,529
1,038
29.4
2,491
14.1
(%)
1.7
19.9
10.8
2.9
Krishnan Sambamoorthy – Research Analyst
(Krishnan.Sambamoorthy@motilaloswal.com); +91 22 3027 8029
Vishal Punmiya – Research Analyst
(Vishal.Punmiya@motilaloswal.com); +91 22 3980 4261
Investors are advised to refer through important disclosures made at the last page of the Research Report.
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.

Titan Company
Key Quarterly Charts
Exhibit 1: Segmental Snapshot
INR m
Total Sales
Watches
YoY Growth
Jewelry
YoY Growth
Others
YoY Growth
Total EBIT
Watches
YoY Growth
EBIT Margin
Jewelry
YoY Growth
EBIT Margin
Others
1QFY17
28,406
4,997
3.0%
21,506
3.7%
1,902
305.4%
1,765
38
-92.1%
0.8%
2,039
12.3%
9.5%
(311)
2QFY17
27,150
5,247
-5.0%
20,074
1.2%
1,829
21.8%
2,440
576
-31.1%
11.0%
2,094
73.8%
10.4%
(229)
3QFY17
40,001
5,125
5.9%
33,042
17.2%
1,834
37.6%
3,550
529
63.1%
10.3%
3,343
15.1%
10.1%
(321)
4QFY17
36,150
4,985
11.0%
28,866
56.3%
2,300
107.9%
2,551
55
-29.0%
1.1%
2,647
27.3%
9.2%
(151)
1QFY18
40,496
5,118
2.4%
33,522
55.9%
1,856
-2.5%
3,525
399
964.0%
7.8%
3,233
58.6%
9.6%
(106)
2QFY18
35,177
5,718
9.0%
27,482
36.9%
1,978
8.1%
4,113
826
43.6%
14.5%
3,485
66.4%
12.7%
(198)
3QFY18
42,962
5,355
4.5%
35,699
8.0%
1,908
4.1%
4,085
686
29.8%
12.8%
3,663
9.6%
10.3%
(265)
4QFY18
41,275
4,924
-3%
33,581
14%
2,752
18.6%
4,104
174
218%
3.5%
4,247
60%
12.6%
(317)
Source: Company, MOSL
Exhibit 2: Tanishq LTL growth stood at 17% for 4QFY18
Tanishq- LTL Growth (%)
68.0
30.0
6.0
(13.0)
(8.0)
(12.0)
(25.0)
(5.0)
3.0
(40.0)
4.0
15.0
52.0 51.0
18.0 12.0 17.0
Source: Company, MOSL
Exhibit 3: Jewelry grammage grew 6% in 4QFY18
Jewelry volume Growth %
75.0
25.0
(2.0)
(24.0)
28.0
15.0
49.0
49.0
37.0
6.0
4.0
6.0 6.0
Exhibit 4: Watches volumes down by 1% YoY
Watches volume growth (%)
11 9
9
(4) (6) (4)
0
0
1
(9)
(19)
10
4
5
9 11
(11.0) (10.0)
(10.0)
(1)
(32.0)
Source: Company, MOSL
Source: Company, MOSL
3 November 2017
2

Titan Company
Exhibit 5: Jewelry volume growth against the gold price movement
Jewelry volume Growth %
21
28
-10
(7)
15
10
4
6
-32
14
Gold price change (%)
37
5
(1)
(6)
(0)
49
49
6
6
5
(2)
4
2QFY16 3QFY16 4QFY16 1QFY17 2QFY17 3QFY17 4QFY17 1QFY18 2QFY18 3QFY18 4QFY18
Source: Company, MOSL
Exhibit 6: Net space addition excluding Mia and Carat lane stores
Space (in ‘000 sqft)
Format
World of Titan
Fastrack
Helios
Tanishq
Goldplus
Zoya
Eye+
Total
FY15
Space
416
90
53
718
81
7
225
1590
Stores
427
157
43
177
33
2
384
1223
Space
423
94
48
808
81
7
259
1720
FY16
Stores
452
159
41
193
32
2
404
1283
Space
420
90
50
868
73
7
293
1801
FY17
Stores
474
155
49
208
29
2
448
1365
FY18
Space
Stores
411
486
92
166
67
70
995
253
18
9
10
3
331
500
1957
1559
Source: Company, MOSL
Exhibit 7: Jewelry: Key operating parameters
Jewelry
Volume Gr (%)
Customer Gr (%)
Studded Share (%)
Sales Gr (%)
4Q15
(11)
(7)
37
(15)
1Q16
(10)
NA
29
(11)
2Q16
(10)
NA
24
(32)
3Q16
28
NA
25
20
4Q16
15
NA
34
1
1Q17
6
NA
24
3
2Q17
(32)
NA
42
0
3Q17
4
NA
21
17
4Q17
37
NA
30
55
1Q18
49
NA
23
56
2Q18
49
NA
36
37
3Q18
6
NA
25
8
4Q18
6
NA
36
14
Source: Company, MOSL
Exhibit 8: Tanishq posted LTL retail sales growth of 17%
Jewellery
Sales Gr %
LTL Growth %
Stores
4QFY17
Tanishq+Goldplus
55
52
239
3QFY18
Tanishq+Goldplus
15
12
247
4QFY18
Tanishq+Goldplus
19
17
265
Source: Company, MOSL
Exhibit 9: Watches segment sales saw a decline of 2.5% YoY
Watches
Gr %
World of Titan
Helios
Fastrack
LFS - Watches
Sales Gr (%)
Net sales INR b
4QFY17
Sales Growth LTL Growth
8
5
4
(3)
0
(1)
12
3
12.5
5.1
3QFY18
Stores (x) Sales Growth LTL Growth
474
8
7
49
37
4
155
10
6
NA
11
6
4.5
20.4
4QFY18
Stores (x) Sales Growth LTL Growth
481
(3)
(4)
67
32
5
164
1
(6)
NA
14
11
(2.5)
5.4
Stores (x)
486
70
166
NA
Source: Company, MOSL
3 November 2017
3

Titan Company
Exhibit 10: Titan Eye+: Sales grew 23%, with LTL retail growth of 14%
Titan Eye+
Stores
Sales Growth (%)
LTL Growth (%)
4QFY16
404
18
7
1QFY17
405
9
(2)
2QFY17
413
10
4
3QFY17
428
10
4
4QFY17
448
9
1
1QFY18
457
10
3
2QFY18
462
10
3
3QFY18
478
23
14
4QFY18
327
23
14
Source: Company, MOSL
Con-call highlights
Management commentary keeps improving
They are seeking to step up store expansion: 40 plus in FY19 v/s 23-24 in FY18.
They had not stated this earlier and this is a sign of increasing confidence. Many
of the new stores will be in small town India and 85% of these will be
franchisees. Management also reiterated in the call that they are targeting
another 25% growth in jewelry sales in FY19 on top of a similar number in FY18.
Seen in line with their recent statement on increase in jewelry sales growth
guidance (20% CAGR between FY18-23 instead of 20% CAGR over FY17-FY22),
the outlook keeps getting better.
Their margin confidence also keeps improving. At the end of FY17, they had
stated that if the company has to sacrifice margins for rapid growth over the
next two years they will do so. Sometime during FY18 they changed the
commentary and stated that if they have to sacrifice margin growth in order to
grow sales rapidly they will do so. Now they are stating that if pace of jewelry
sales growth continues, then EBIT margins are likely to expand because of
operating leverage.
Other points on Jewelry industry and Tanishq
Industry consolidation continues to happen at a rapid pace.
Increase in share of exchange gold at Tanishq (around 30% of sales now) is
sustainable. In many cases the customer purchases jewelry value much higher
than the jewelry that they bring in.
Ticket sizes have been improving on diamond jewelry as well as plain gold
jewelry.
4QFY18 witnessed 19% retail sales growth in jewelry.
Studded jewelry was 36% of sales in 4QFY18.
Golden Harvest Scheme was 14% of sales in FY17, was 17% in FY18 and
management expects further improvement going forward.
Wedding and high value diamond jewelry is now around 33% of sales.
Jewelry margin improvement in 4QFY18
Studded jewelry mix was higher in 4QFY18, and thus, jewelry segment margins
were higher. There was better mix in non-studded jewelry as well. There were
some hedging gains of INR180m as well. Management suggested looking at
annual margins in jewelry rather than 4Q as a barometer for the future.
There were two components to jewelry segment margin improvement of 170bp
in full year FY18 – gross margins and operating leverage. Management believes
that the former may have already played out to some extent, but the latter is
likely to continue if sales growth maintains its rapid pace.
3 November 2017
4

Titan Company
Watches business
Adjusted for GST impact, they attained double-digit sales growth in FY18 and
targeting double-digit growth in FY19 as well.
Change in accounting and extra ordinaries
Accounting changes: Gold on loan- Earlier shown as trade payables, now shown
separately.
Commission to Tanishq franchisees- Now shown as selling and distribution
expenses and not netted off from sales, adjustment made for base year as well.
Exceptional of INR750m on account of Favre Leuba in standalone accounts in
4QFY18. No impact on consolidated accounts.
Valuation and view
Management’s increasing confidence on Jewelry is reflected in its revised strong
guidance of 20% CAGR for the next five years, sharply increased store expansion
target of 40, and commentary about further margin expansion because of
operating leverage. Recent developments in the sector are only strengthening
the case for rapid growth of the Tanishq business.
Our EPS forecasts are up by 4.3%/5.8% for FY19/20. Stretched valuations are
fully deserved for a business that has perhaps the best top-line growth potential
in the large cap FMCG/retail space. Moreover, the improving margins outlook
drives our earnings growth expectations higher.
Maintain
Buy
with a target price of INR1,150 (INR1,090 earlier), based on 55x
Mar’20E EPS (at a 30% premium to three-year average P/E).
Exhibit 1: There is a 4.3%/ 5.8% increase in our EPS forecasts for FY19E/FY20E
New
Sales
EBITDA
PAT
FY19E
197,292
20,990
14,734
FY20E
238,964
26,058
18,547
FY19E
194,458
19,659
14,131
Old
FY20E
235,509
24,446
17,537
Change (%)
FY19E
FY20E
1.5%
1.5%
6.8%
6.6%
4.3%
5.8%
Source: Company, MOSL
Exhibit 11: Titan
P/E (x)
80.0
60.0
40.0
20.0
0.0
P/E (x)
Min (x)
Avg (x)
+1SD
Max (x)
-1SD
60.4
43.6
32.2
20.8
12.1
Exhibit 12:
Retail sector P/E (x)
50.0
40.0
30.0
20.0
10.0
0.0
P/E (x)
Min (x)
Avg (x)
+1SD
36.7
26.8
16.9
8.6
Max (x)
-1SD
46.6
42.7
57.9
Source: Company, MOSL
Source: Company, MOSL
3 November 2017
5

Titan Company
Exhibit 2: Valuation Matrix
Company
Consumer
Asian Paints
Britannia Inds.
Colgate-Palm.
Dabur India
Emami
Godrej Cons.
Hind. Unilever
ITC
Jyothy Lab.
Marico
Nestle India
P & G Hygiene
Page Industries
Pidilite Inds.
United Spirits
Retail
Jubilant Food.
PC Jeweller
Titan Company
Neutral
Buy
Buy
2,475 2,450
209
973
520
1,150
-1
149
18
168
82
875
2.5
1.2
13.0
180.6
44.4
39.5
39.1
26.6
31.7
31.4
27.6
25.9
83.2
13.6
77.2
59.8
10.7
58.6
45.5
8.4
46.6
20.3
16.9
23.9
0.1
0.5
0.4
Neutral
Buy
Buy
Buy
Buy
Neutral
Buy
Neutral
Neutral
Neutral
Neutral
Neutral
Buy
Buy
Neutral
1,215 1,250
5,385 6,180
1,096 1,420
368
59
435
76
1,042 1,390
1,078 1,155
5,873 6,230
1,494 1,530
280
370
316
275
405
350
3
15
30
18
33
29
7
6
2
-2
10
11
6
-1
16
3
32
8
1,174
649
297
649
232
104
744
247
3,237
3,429
67
407
877
311
267
558
297
480
17.4
9.6
4.4
9.6
3.4
1.6
11.1
3.7
48.1
51.0
1.0
6.0
13.0
4.6
4.0
8.3
4.4
7.1
1.9
14.3
12.9
7.2
-8.5
Loss
11.7
3.1
22.1
6.6
-24.8
2.0
13.2
6.9
24.5
5.4
62.0
22.1
21.1
24.8
17.9
16.0
21.9
LP
14.9
14.1
17.9
13.7
29.3
18.3
35.2
20.5
39.9
17.0
23.9
74.3
19.0
25.1
19.7
15.5
20.4
276.5
15.9
17.4
17.8
12.4
24.0
18.2
10.4
17.3
32.2
14.9
31.2
38.1
57.5
63.9
45.7
47.3
43.0
NM
51.1
36.5
62.4
31.3
43.7
49.2
64.2
68.5
79.9
61.6
78.2
99.5
47.4
51.2
38.8
40.8
35.3
196.1
44.5
32.0
52.9
27.5
33.8
41.6
47.5
56.8
57.1
52.6
63.1
57.1
39.9
40.9
32.4
35.3
29.3
52.1
38.3
27.2
44.9
24.5
27.3
35.2
43.0
48.5
43.2
45.8
48.1
41.4
25.3
33.9
49.9
25.9
29.2
-1.8
24.9
20.7
78.2
22.8
14.3
34.0
40.3
61.2
39.9
24.2
14.9
17.2
0.8
0.4
0.9
0.6
0.8
0.0
0.5
1.2
1.1
2.0
1.6
1.3
0.7
3.3
0.4
0.4
0.1
0.0
Reco
CMP
(INR)
Target
Price
Mkt Cap
USD B
EPS Growth YoY (%)
FY18E
FY19E
FY20E
FY18E
P/E (x)
FY19E
RoE (%) Div. (%)
FY20E FY18E
FY17
(INR) Upside (%) INR B
Future Consumer Buy
GlaxoSmith C H L Neutral
8,986 9,535
9,732 9,672
23,753 27,490
1,085 1,115
1,100 1,450
3,248 3,510
United Breweries Buy
Source: Company, MOSL
3 November 2017
6

Titan Company
Financials and valuations
Income Statement
Y/E March
Net Sales
Change (%)
Total Expenditure
EBITDA
Change (%)
Margin (%)
Depreciation
Int. and Fin. Charges
Other Income - Recurring
Profit before Taxes
Change (%)
Tax
Tax Rate (%)
Profit after Taxes
Change (%)
Margin (%)
Extraordinary income
Reported PAT
2015
119,032
9.0
107,496
11,536
10.0
9.7
874
807
706
10,562
4.0
2,410
22.0
8,233
11.1
6.9
0
8,233
2016
112,759
-5.3
103,412
9,347
-19.0
8.3
982
424
739
8,681
-17.8
1,710
22.1
6,765
-17.8
6.0
0
6,765
2017
132,608
17.6
121,053
11,555
23.6
8.7
1,105
377
705
10,777
24.1
3,021
25.6
8,017
18.5
6.0
-1,027
6,990
2018
161,198
21.6
144,776
16,422
42.1
10.2
1,314
529
889
15,467
43.5
4,500
27.7
11,188
39.5
6.9
-167
11,022
2019E
197,292
22.4
176,301
20,990
27.8
10.6
1,447
557
1,011
19,997
29.3
5,431
26.3
14,734
31.7
7.5
0
14,734
(INR Million)
2020E
238,964
21.1
212,906
26,058
24.1
10.9
1,592
559
1,265
25,173
25.9
6,837
26.3
18,547
25.9
7.8
0
18,547
Balance Sheet
Y/E March
Share Capital
Reserves
Net Worth
Loans
Deferred Tax
Capital Employed
Gross Block
Less: Accum. Depn.
Net Fixed Assets
Intangibles
Capital WIP
Investments
Curr. Assets, L&A
Inventory
Account Receivables
Cash and Bank Balance
Others
Curr. Liab. and Prov.
Current Liabilities
Provisions
Net Current Assets
Application of Funds
E: MOSL Estimates
2015
888
32,637
33,525
998
64
34,587
11,824
5,103
6,720
102
552
290
50,932
40,493
1,897
2,138
6,403
24,010
22,943
1,067
26,922
34,587
0
2016
888
34,178
35,066
1,131
131
36,327
13,559
6,054
7,506
200
1,067
26
54,624
44,472
1,925
1,442
6,785
27,095
25,794
1,302
27,529
36,327
0
2017
888
41,700
42,587
0
-33
42,555
15,754
7,116
8,638
3,337
1,432
3,937
66,698
49,257
2,076
8,159
7,205
41,488
40,077
1,412
25,210
42,555
0
2018E
888
49,993
50,881
790
-329
51,342
19,634
8,387
11,247
3,495
430
16
79,694
59,248
2,957
6,523
10,965
43,540
42,129
1,411
36,154
51,342
0
2019E
888
55,962
56,850
500
-497
56,853
21,709
9,834
11,875
3,495
430
16
91,623
65,549
3,158
10,307
12,610
50,587
49,175
1,412
41,037
56,853
0
(INR Million)
2020E
888
58,681
59,568
250
-708
59,110
23,784
11,426
12,358
3,495
430
16
98,401
76,611
4,285
3,003
14,502
55,589
54,178
1,412
42,811
59,110
0
3 November 2017
7

Titan Company
Financials and valuations
Ratios
Y/E March
Basic (INR)
EPS
Cash EPS
BV/Share
DPS
Payout %
Valuation (x)
P/E
Cash P/E
EV/Sales
EV/EBITDA
P/BV
Dividend Yield (%)
Return Ratios (%)
RoE
RoCE
RoIC
Working Capital Ratios
Debtor (Days)
Asset Turnover (x)
Leverage Ratio
Debt/Equity (x)
-1,140
-312
2015
9.3
10.3
37.8
2.8
29.8
2016
7.6
8.7
39.5
5.4
70.3
2017
9.0
10.2
48.0
3.6
39.7
2018E
12.6
14.0
57.3
6.3
50.0
2019E
16.6
17.8
64.0
11.6
70.0
2020E
20.9
22.2
67.1
17.8
85.0
104.9
94.8
7.2
74.7
25.8
0.3
127.6
111.9
7.7
92.3
24.6
0.6
107.7
95.1
6.4
73.7
20.3
0.4
77.2
69.3
5.3
52.2
17.0
0.6
58.6
54.5
4.3
40.7
15.2
1.2
46.6
43.8
3.6
33.0
14.5
1.8
28.0
26.1
30.0
6
3.4
19.7
20.0
19.9
6
3.1
20.6
21.0
24.8
6
3.1
23.9
24.6
29.8
7
3.1
27.4
28.0
31.8
6
3.5
31.9
32.7
35.4
7
4.0
0.0
0.0
0.0
0.0
0.0
0.0
Cash Flow Statement
Y/E March
OP/(loss) before Tax
Int./Div. Received
Deferred Revenue Exp.
Depreciation & Amort.
Interest Paid
Direct Taxes Paid
Incr in WC
CF from Operations
Extraordinary Income
Incr in FA
Free Cash Flow
Investments
CF from Invest.
Issue of Shares
Incr in Debt
Dividend Paid
Others
CF from Fin. Activity
Incr/Decr of Cash
Add: Opening Balance
Closing Balance
E: MOSL Estimates
2015
10,562
-706
0
874
807
2,410
7,021
2,105
0
1,691
414
61
-1,752
0
-7,065
2,116
-2,041
-7,140
-6,787
8,925
2,138
2016
8,681
-739
0
982
424
1,710
1,302
6,335
0
2,348
3,987
-265
-2,084
3
133
2,458
2,625
-4,948
-696
2,138
1,442
2017
10,777
-705
0
1,105
377
3,021
-9,036
17,570
-1,027
5,698
10,846
3,912
-10,636
16
-1,131
4,757
-5,655
-217
6,717
1,442
8,159
2018E
15,467
-889
0
1,314
529
4,500
12,581
-658
-167
3,035
-3,860
-3,921
720
0
790
2,778
-291
-1,697
-1,636
8,159
6,523
2019E
19,997
-1,011
0
1,447
557
5,431
1,099
14,460
0
2,075
12,385
0
-2,075
0
-290
6,012
2,299
-8,601
3,784
6,523
10,307
(INR Million)
2020E
25,173
-1,265
0
1,592
559
6,837
9,078
10,143
0
2,075
8,068
0
-2,075
0
-250
10,995
4,127
-15,372
-7,304
10,307
3,003
3 November 2017
8

Titan Company
Corporate profile
Company description
Titan Industries (TTAN) is one of India's largest
specialty retailers. It is the market leader in
Watches and a pioneer in Branded Jewelry. The
company's economy segment watch, Sonata is
the largest selling watch in the country. TTAN
entered the branded jewelry segment in 1996
with the brand and remains the largest player
in this segment.
Exhibit 1: Sensex rebased
Source: MOSL/Bloomberg
Exhibit 2: Shareholding pattern (%)
Mar-18
Promoter
DII
FII
Others
52.9
6.3
20.7
20.1
Dec-17
52.9
5.9
21.3
20.0
Mar-17
53.1
5.4
21.1
20.4
Source: Capitaline
Exhibit 3: Top holders
Holder Name
JHUNJHUNWALA RAKESH RADHESHYAM
LIC OF INDIA CHILD FORTUNE PLUS GROWTH
FUND
MATTHEWS PACIFIC TIGER FUND
RAKESH JHUNJHUNWALA
JHUNJHUNWALA REKHA RAKESH
% Holding
5.3
2.1
2.1
1.6
1.6
Source: Capitaline
Note: FII Includes depository receipts
Exhibit 4: Top management
Name
C V Sankar
Bhaskar Bhat
A R Rajaram
Designation
Chairman
Managing Director
Company Secretary
Exhibit 5: Directors
Name
C G Krishnadas Nair
Harish Bhat
Ireena Vittal
T K Balaji
N N Tata
Name
Das Narayan Das
Hema Ravichandar
T K Arun
Vinita Bali
Source: Capitaline
*Independent
Exhibit 6: Auditors
Name
Deloitte Haskins & Sells
P S V & Associates
Type
Statutory
Cost Auditor
Exhibit 7: MOSL forecast v/s consensus
EPS
(INR)
FY19
FY20
MOSL
forecast
16.6
20.9
Consensus
forecast
16.6
20.9
Variation (%)
-0.2
0.1
Source: Bloomberg
Source: Capitaline
3 November 2017
9

Explanation of Investment Rating
Investment Rating
BUY
SELL
NEUTRAL
UNDER REVIEW
NOT RATED
Expected return (over 12-month)
>=15%
< - 10%
> - 10 % to 15%
Rating may undergo a change
We have forward looking estimates for the stock but we refrain from assigning recommendation
Titan Company
*In case the recommendation given by the Research Analyst becomes inconsistent with the investment rating legend, the Research Analyst shall within 28 days of the inconsistency, take appropriate measures to make the recommendation consistent with the investment rating legend.
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a)
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This report has been prepared by MOSL and is meant for sole use by the recipient and not for circulation. The report and information contained herein is strictly confidential and may not be altered in any way, transmitted to, copied or distributed, in part
or in whole, to any other person or to the media or reproduced in any form, without prior written consent of MOSL. The report is based on the facts, figures and information that are considered true, correct, reliable and accurate. The intent of this report
is not recommendatory in nature. The information is obtained from publicly available media or other sources believed to be reliable. Such information has not been independently verified and no guaranty, representation of warranty, express or implied,
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The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the research analyst(s) was, is, or will be directly or indirectly related to the
specific recommendations and views expressed by research analyst(s) in this report.
Disclosure of Interest Statement
Analyst ownership of the stock
Titan Company
No
A graph of daily closing prices of securities is available at
www.nseindia.com, www.bseindia.com.
Research Analyst views on Subject Company may vary based on Fundamental research and Technical Research. Proprietary trading desk of MOSL or
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Registration details of group entities.: MOSL: SEBI Registration: INZ000158836 (BSE/NSE/MCX/NCDEX); CDSL: IN-DP-16-2015; NSDL: IN-DP-NSDL-152-2000; Research Analyst: INH000000412. AMFI: ARN 17397. Investment Adviser:
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3 November 2017
10