Amit Kumar of Unifi Capital presented his in-depth investment thesis on Titan Company (India: TITAN) at Asian Investing Summit 2020.

Thesis summary:

Titan Company is a joint venture between the Tata Group and the Tamil Nadu Industrial Development Corporation. It is the world’s fifth-largest wrist watch manufacturer and India’s leading producer of jewelry and watches. The company makes watches, jewelry, precision engineering, and eyewear. It manufactures precious jewelry under the Tanishq brand name and watches under the brand names Titan, Fastrack, Sonata, Nebula, RAGA, Regalia, Octane & Xylys. The company exports watches to 32 countries around the world. Titan’s retail chain had nearly 1,800 stores at the end of 2019, with total retail area of 2.3 million square feet.

Titan, recently valued at $10 billion, has annual revenue of $2.5 billion and is long-term play on Indian urbanization and the trend toward branded consumer goods. There is a large presence of unorganized players in the jewelry and watches sectors in India. Gradually, those informal players are ceding market share to Titan and other branded players, driven by increased compliance, business scale advantages, distribution channels, and consumer preferences in favor of brands. There appears to be a long trajectory of growth, with a strong competitive edge, for Titan in Indian market. Earnings should grow fairly consistently for many years to come.

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About the instructor:

Amit Kumar, CFA has twelve years of experience in financial analysis, investment research, and corporate banking. He focuses on researching mid- and small-cap stocks in the Indian market. He looks for sustainable earning growths. He holds an MBA (finance) degree from XLRI Jamshedpur. His graduation was in the field of production engineering from NIT Trichy, a top engineering colleges in India. Apart from investment research, his hobby is long-distance running. He is part of Striders, a leading running club in Mumbai and has completed dozens of half marathons. He also completed the Amsterdam marathon in less than five hours. Next, he is eyeing the Comrades ultra-marathon in South Africa.