“Wedding Demand Intact, Despite Gold at ₹1 Lakh” – PL Capital Says Titan Well-Positioned to Outshine Rivals
- 23rd June 2025
- 01:00:00 PM
- 5 min read
Mumbai | June 23 – As gold prices soar past the ₹1 lakh per 10g mark and weigh on discretionary jewellery purchases, Titan Company Ltd (TTAN) is emerging as the standout performer in India’s organised jewellery landscape. The company continues to benefit from resilient wedding-related demand and sustained expansion into Tier-2 and Tier-3 markets.
“Wedding-related demand was relatively resilient, given the essential nature of such purchases,” notes PL Capital in its consumer sector update dated 20 June 2025.
Despite a sharp decline in volumes, value demand has remained in low single digits, supported by events such as Akshaya Tritiya and a significant year-on-year increase in wedding days across North and South India.
What’s Driving the Momentum?
PL Capital expects Titan to deliver 17% sales growth, 25% EBITDA growth, and 25.6% PAT growth in Q1FY26. This comes off a low base, but is nonetheless indicative of strong traction amid a tough macro setup.
Key Forecasts for Q1FY26 (Standalone)
| Metric | Estimate YoY Growth |
| Sales | ₹17% |
| EBITDA | ₹25% |
| PAT | ₹25.6% |
| Jewellery EBIT Margins* | -20 bps |
| Watch Segment Margins | +40 bps |
*Excludes bullion; margin contraction is attributed to heightened pricing competition and limited room for premium hikes.
Key Highlights
- Wedding demand remains robust despite record-high gold prices.
- Sales of high-value, non-ceremonial jewellery (above ₹50,000) have moderated.
- Approximately 40–45% of new purchases involve gold exchange, helping consumers manage affordability.
- Regional and local players are slowing expansion due to higher inventory costs and lack of hedging.
- Franchise interest across peers has weakened, although Titan’s direct expansion strategy remains intact.
- Investment demand (bars and coins) has risen ~10%, indicating a consumer shift toward wealth preservation.
- Lightweight and daily-wear jewellery (14k–18k) is gaining popularity, particularly among younger consumers.
Gold Prices Have Spiked — But So Have Wedding Days
One of the strongest structural supports to jewellery demand in Q1FY26 is the significant increase in the number of auspicious wedding days, particularly in North India.
Wedding Days – Regional Trend
| Region | Q1FY25 | Q1FY26 | YoY Growth |
| North India | 9 | 29 | 222% |
| South India | 18 | 31 | 72% |
This rise in wedding occasions has helped sustain value demand despite a notable drop in physical volumes.
Market Dynamics: Regional Players Under Pressure
The surge in gold prices has forced many local and regional jewellers—who typically lack access to hedging instruments and lease-based procurement—to put expansion plans on hold. Inventory cost pressures have also reduced new franchise inquiries, particularly for peers such as Kalyan Jewellers and Senco Gold.
PL Capital highlights that Titan is comparatively insulated due to:
- A scalable, franchise-led model.
- Access to gold on lease.
- Strong brand trust and transparent pricing practices.
- Significant digital capabilities through omnichannel platforms like CaratLane.
“Players like Kalyan and Senco have been already slow at franchise openings in the past two quarters. Titan’s ability to expand in Tier-2 and Tier-3 cities amid this vacuum is a key market share opportunity,” PL Capital analysts observed.
Margin Outlook: Soft But Stable
Titan’s jewellery margins had previously benefitted from gains in diamond inventory, particularly in FY22 and FY23. However, FY24 and FY25 have seen margin pressure due to falling diamond prices and rising competition.
PL Capital expects a modest recovery in margins in FY26, driven by a favourable product mix and operational efficiencies.
Jewellery EBIT Margins Trend (Ex-Bullion)
| FY | EBIT Margin (%) |
| FY22 | 13.8 |
| FY23 | 11.4 |
| FY24 | 11.2 |
| FY25E | 11.5 |
| FY26E | 11.6 |
Jewellery Demand Recalibrates as Gold Hits Record Highs
According to the World Gold Council, India’s gold jewellery demand fell 25% year-on-year in Q4FY25 to 71 tonnes — the lowest since Q3FY20. Yet, value demand rose 3% over the same period, reflecting the impact of high prices.
This surge in pricing has significantly altered buying behaviour. Consumers are now opting for lower-grammage, more affordable jewellery, including lightweight daily-wear styles in 14k and 18k gold. Trade-ins of old jewellery account for nearly 45% of new purchases. Moreover, a ~10% increase in demand for gold bars and coins suggests that buyers are viewing gold more as a store of value than a consumption item.
This behavioural pivot—from adornment to preservation—favours established, transparent brands with robust supply chains and consumer trust. In this context, Titan’s market leadership appears increasingly defensible.
Bottomline
Titan continues to stand out as a structurally sound, well-capitalised player within a jewellery market undergoing a meaningful transition. With seasonal demand triggers such as increased wedding dates and declining competitive intensity from regional players, the company is well-placed to gain incremental share—particularly in underpenetrated Tier-2 and Tier-3 markets.
The contraction in expansion across peers, combined with Titan’s supply chain depth and omnichannel reach, further strengthens its position. While elevated gold prices remain a key risk, Titan’s diversified portfolio, operational efficiency, and brand-driven moat make it one of the best-positioned players in the current market.
PL Capital maintains a BUY rating on Titan Company Ltd., with a SOTP-based target price of ₹3,754.
PL Capital
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.
