This Jhunjhunwala stock slips 31% from record high, should you buy the dip?

Titan Company stock was the top loser on Sensex and Nifty as Indian market fell for the sixth straight session today. The stock, which forms a key component of ace investor Rakesh Jhunjhunwala's portfolio, fell 7.11 per cent to an intraday low of Rs 1911 on the BSE.

The stock is down 31 per cent from the all-time high of Rs 2767.55 hit on March 21 this year. It touched a 52-week low of Rs 1,661 on July 20, 2021.

Jhunjhunwala and his wife Rekha together held 4,48,50,970 shares, or 5.05 per cent stake, in the company at the end of March quarter. In the last quarter, Rakesh Jhunjhunwala held 3.53 crore shares, or 3.98 per cent stake, in the firm. His wife Rekha owned 95.40 lakh shares, or 1.07 per cent stake in the firm.

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The large cap stock has fallen 7.72 per cent in the last two days. The luxury goods stock was the top Sensex and Nifty loser today. On Nifty, the stock fell to an intraday low of Rs 1,910.55 against the previous close of Rs 2060.

The share has climbed 12.86 per cent in a year but lost 23.63 per cent since the beginning of this year. Titan Company stock is trading lower than 5-day, 20-day, 50-day, 100-day and 200-day moving averages.

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A total of 1.19 lakh shares of the firm changed hands, amounting to a turnover of Rs 23.44 crore. Market cap of the firm fell to Rs 1.71 lakh crore on the BSE.

 Here's a look at what analysts and brokerages said about outlook of the stock.

AR Ramachandran, Co-founder & Trainer, Tips2Trade

"Weak Q4FY22 results coupled with a slowing economy and rising interest rate scenario has led to Titan among other stocks at six-month lows. Technically, Titan looks oversold and long-term investors can start buying in small quantities with near term target of Rs 2,130."

Tirthankar Das, Head of Technical Research, Ashika Group

"Main trend is down according to the daily swing chart. The downtrend was reaffirmed once sellers took out the psychological level of Rs 2,000. Prices now trading below the 200 day moving averages and the 38.2% retracement of the entire rally since Mar'20 (High: Rs 2768; Low: Rs 720), signalling further downsides. Slower pace of retracement also suggests inherent weakness and the presence of bearish 'Head & Shoulder' formation implies negative bias. Immediate support for the stock appears from 100WEMA at Rs 1900- Rs 1915. Hence outlook continues to remain neutral to negative with lower target of  Rs 1740- Rs 1750 (50% retracement).

Manoj Dalmia, founder and director, Proficient Equities

"Titan shares are currently trading at Rs 1,929. At the current levels, we can expect some volatility and a downmove can be expected as the stock is below Rs 2,020 and below 200 exponential moving averages. We have a target of Rs 1,860. If it falls further, it can reach Rs 1,740 levels. Investors can accumulate on dips as it is a value stock and will perform well in the long term." 

Ravi Singhal, Vice Chairman, GCL Securities Limited

"Following the interest rate hike, all stocks are declining, particularly lifestyle stocks. Because inflation is at its peak, demand for such products may fall, but we do see some value buying near Rs 1,800. In the next 18 months, target for the stock is  Rs 2400. Maintain a stop loss of Rs 1,670."

Ravi Singh, vice President and head of Research, Share India

"Titan stock is in correction mode taking cues from the overall weakness in the market. Higher inflation, fear of economic growth worries and fiscal tightening measures has taken a toll on the equity markets. Titan stock may see more sell-off in the coming days. It may touch the levels of  Rs 1800 and remain in major downtrend. Investors must abstain from this stock for investment in the near term."

Pravesh Gaur, Sr. Technical Analyst, Swastika Investmart

"The counter has witnessed a breakdown of head & shoulder pattern formation in the longer timeframe. The overall structure is distorted as it trades below its 100,200 SMA moving averages and Momentum indicators are also negatively poised On the downside, 1800 is the strong support level where we can expect a bounceback while on the upside, Rs 2150 is an immediate hurdle."

On the other hand, Credit Suisse has maintained a neutral view on Titan Company. It has assigned a target price of Rs 2,600, an upside of 23 percent to June 14 close. 

The company reported a 7.21 per cent decline in its consolidated net profit at Rs 527 crore in the fourth quarter ended March 2022. It had posted a net profit of Rs 568 crore in the January-March quarter of FY21.

Total income rose 4.25 per cent to Rs 7,872 crore in Q4 as against Rs 7,551 crore in the corresponding period of the preceding fiscal. Revenue from sales of products was down 1.14 per cent to Rs 7,267 crore in the fourth quarter of FY22 as against Rs 7,351 crore a year ago.

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