2023 has started off terribly for the stock of Titan Company as the stock lost 7.7% in just 8 trading sessions!

Investors were optimistic towards stock when 2022 began. The stock had surged 15% in less than a month as market sentiment was positive about the scrip. However, the optimism was lost in the second half of January as rumours of Russias plan to invade Ukraine spooked investors as markets declined globally. Titan Co. lost 11% in 5 trading sessions at the time!

February brought some relief, but the stock dropped once again in March. The markets were in a terrible state due to the Russia-Ukraine war at the time as Titan’s stock declined 7.9% in 5 sessions. However, Titan’s greatest downtrend began in May 2022 after being range bound for a month.

On 3rd March, 2022, Titan Co. published its results for the quarter ended in March 2022 wherein the company reported a 7% decline in profits, a 1% decline in EBITDA and a mere 4% growth in revenues on account of growth in operating revenues. This initiated a selloff as investors began dumping the stock, resulting in the stock losing 18.7 in 3 weeks!!

Even though the company announced a Rs 7.50 per share dividend, it was unable to avoid the selling frenzy induced by its poor results. The stock fell through the Rs 2,000 mark and touched lows which it hadn’t since September 2021. After falling a record 28% in 3 months, buying picked up once again in the stock.

The stock reversed and began climbing in July 2022 as it grew 25% in one month. Moreover, the company’s Q1FY23 financial result assisted the stock in its climb. The company had reported a multifold growth in profits and a 199% surge in revenues due to strong demand during the festive season.

However, the stock began declining once again on 4th November, 2022, after the company published its Q2FY23 results. Despite reported figures significantly better than estimates, the stock entered a downtrend as it steadily hit lower highs and lower lows. 

 

All in all, the stock reported a marginal gain of 3.9% during 2022. But 2023 began at a negative note as the stock fell over 7% despite posting a positive business update for Q3FY23.

 

What is the future outlook of Titan Co.?

Fundamentally, the company’s Q3FY23 business update stated a 12% You growth in sales as the company improved its presence throughout the country. Moreover, its emerging business segment, which includes its Indian ethnic wear and fashion accessories foray, has shown a 75% YoY growth during the quarter ended in Q3FY23.

Titan’s endeavour to diversify its business and the successful growth in the same is testament of improving business performance. Consistent profit reporting and relatively equal dependence on all business segments along with the fact that the stock gave 180+% growth in 3 years make the stock an attractive investment opportunity.

 

 

Technically, the stock is trading below its 5,20,50,100 and 200 day average. Moreover, it recently breached through its 200 day moving average, which is a critical support level in price action trading. Moreover, with its RSI at 34.56, the stock is neither overbought nor oversold.

Therefore, the stock could see some near term weakness before it finds buyers.

Report by Jobaaj Group.