Motilal Oswal Financial Services has retained its Buy recommendation on seven stocks following their June-quarter performance reviews. According to reports from NDTV Profit, the brokerage sees potential upside ranging from 16% to 30% based on target prices cited in respective Q1 result updates. The seven companies include Inox Wind, Mrs Bectors Food Specialities, G R Infraprojects, Kirloskar Oil Engines, Premier Energies, State Bank of India, and Titan Company.
Titan Company shares gained 2% to ₹5,030 on Monday after reporting exceptional Q1 results with consolidated net profit surging 63% YoY to ₹1,777 crore, compared with ₹1,091 crore in the year-ago period. The jewellery business led growth with revenue rising 43% YoY to ₹18,253 crore, excluding bullion and digi-gold sales, attributed to festive purchases, Akshaya Tritiya sales and exchange programmes. Motilal Oswal retained its Buy rating with a revised target price of ₹6,000, implying 17% upside, and has raised EPS estimates by 3-4% for FY27 and FY28. The brokerage expects Titan to remain the bellwether of the jewellery industry with 18% sales CAGR, 22% EBITDA CAGR and 25% APAT CAGR over FY26-28E.
According to The Financial Express, Kalyan Jewellers offers the highest potential upside of 33% among the jewellery sector stocks, with Motilal Oswal maintaining a 'Buy' rating and target price of ₹800. The brokerage's preference for Kalyan is driven by its expansion beyond South India and growing presence in smaller cities, which could provide room for further market-share gains. PN Gadgil Jewellers follows with a 27% upside potential and target price of ₹800, while Titan Company rounds out the top picks with 17% upside and target price of ₹6,000.
The jewellery sector is experiencing a structural shift with organised retailers now accounting for 40-45% of India's jewellery market, compared with 20-25% in FY19, as reported by The Financial Express. Motilal Oswal estimates the listed jewellery universe generated revenue of around ₹1.4 lakh crore in FY26, with revenue growing at a 34% compound annual growth rate (CAGR) between FY22 and FY26. The brokerage notes that formalisation and premiumisation are key growth drivers, with around 68% of new organised jewellery stores added between June 2024-2026 located in cities outside metros and Tier-1 locations. Leading retailers are expanding their customer base and increasing spend per customer through premiumization, omnichannel expansion, and a higher-studded jewelry mix.
Premiumization is emerging as the second key structural growth driver after formalization, with studded jewelry becoming an important differentiator. Kalyan Jewellers has raised its studded mix to around 30%, from the mid-to-high teens a decade ago, while Titan maintains a high 20% studded mix, compared with around 10-11% for Senco Gold and PN Gadgil Jewellers. The higher-studded mix supports structurally stronger gross margins through greater value addition and higher making charges. Titan and Kalyan Jewellers together account for nearly 60% of the total organized jewelry retail footprint, with Titan having around 43% of branded stores and Kalyan Jewellers having around 17%. The brokerage expects organized leaders to further widen their competitive advantage through superior scale, sourcing capabilities, access to funding, and capital efficiency.
