Rakesh Jhunjhunwala stock: Down over 20% from recent high, can this Rakesh Jhunjhunwala stock stage recovery?
The stock hit a 52-week high of Rs 2,767.55 on March 21, 2022, and a 52-week low of Rs 1,661.85 on July 20, 2021. It closed at Rs 2,128.50 on Wednesday. With a market capitalisation of more than Rs 1,90,000 crore, the shares are trading below their short-term moving averages of 5, 10, 20, 50, 100 and 200-DMAs.
Long-term investors have made big gains by investing in this largecap stock as it has surged over 900 per cent in the last ten years. While brokerages continue to remain bullish on this Tata group company, analysts see further selling pressure on the stock.
Ravi Singh, Vice President and Head of Research, ShareIndia, said is currently in an overbought zone and any breakdown below Rs 2,050 levels can drag the stock up to Rs 1,950 levels in the near term. Traders may refrain from taking any fresh long positions on the counter, he added.
“Titan shares are currently trading at Rs 2,124. At the current level, we can expect some consolidation or volatility. A down move can be expected when the stock closes below Rs 2,040, below that we have a target of Rs 1,860. If it goes further below it can reach Rs 1,793,” said Manoj Dalmia, Founder and Director, Proficient Equities Limited.
“Investors can accumulate on dips as it is a value stock and will perform well in the long term,” Dalmia added.
However, Sharekhan has a ‘Buy’ call on . with a target price of Rs 2,900. Profitability will consistently improve with the jewellery business’ margins remaining stable, and watches and eyecare are expected to see an improvement in margins, while new ventures would add to profitability in the coming years, it said.
“Titan remains our top pick in the largecap consumption space in India, with strong earnings growth visibility and compounding 20% for an elongated period of time,” said
.
“In the jewelry industry, which is organizing at a rapid pace, Titan is clearly at the vanguard among organized players in leading this growth. Its runway for growth is long, with a market share of just 6%. Unlike other high growth categories, the competitive intensity from organized and unorganized peers in jewelry is considerably weaker,” it added.
The brokerage house has a ‘Buy’ rating on the stock with a target price of Rs 2,900.
The company’s standalone profit declined 7.18 per cent year-on-year to Rs 491 crore for the quarter ended March 2022 from Rs 529 crore in the same quarter last year. Revenue from sales of operations for the quarter under review fell by 3.46 per cent to Rs 6,749 crore compared with Rs 6,991 crore in the same quarter last year.
Total income for the quarter came in at Rs 7,352 crore, a growth of 3 per cent compared to Rs 7,169 crore in Q4 FY21. The board also recommended a dividend of Rs 7.5 per equity share.
Jhunjhunwala and his better half Rekha owned 5.1 per cent stake in the Tata Group company, whose value was worth Rs 9,602 crore as of Thursday. An average price target on the stock at Rs 2,598, as suggested by Trendlyne, hints at a potential 22 per cent upside on the counter.
Promoters held 52.9 per cent stake in the company as of 31 March 2022, while FIIs owned 18.4 per cent, DIIs 10.21 per cent.
