Dhanteras, Diwali, Gold and Titan

Titan’s shares are currently trading at a 12 month trailing Price-to-Earnings (P/E) ratio of around 87. That makes it quite an expensive stock. The jewellery businesses of Titan – Tanishq, Zoya, CarterLane etc – contribute around 90% to the revenues of the company. Gold prices are at unprecedented highs this Diwali season. Gold price is currently at around Rs 134,700 per 10 grams in India. Last Diwali it was just Rs 78,000 per 10 grams.

Higher gold prices increase price of gold jewelry

Higher gold prices increase the price of gold jewelry for customers. This may have an adverse impact on demand for them. Tanishq said earlier this year that higher gold prices have reduced demand from customers in the sub – Rs 50,000 segment.

Demand for gold bullion products strong this Diwali season

It was therefore expected by many that sales of jewelry businesses of Titan will remain relatively subdued this Diwali season. But Tanishq is reporting strong sales because of shift in demand from gold jewelry to gold bullion products such as gold bars and coins. Customers are buying gold bars and coins as a form of physical investment in gold. They do not want to wear gold jewelry this Diwali season; they want to invest in gold.

So any decline in sales in jewelry due to high gold prices, this Diwali season, may be offset to a large degree by increased buying of bullion gold products. According to media reports, some jewelry stores have already reported running out of stock of gold bars and gold coins.

Titan’s stock up by more than 12% in 2025

On 17^th October, 2025, a day before Dhanteras, Titan’s stock price ended the day, up by 0.82%, at Rs 3,670. In the past 5 days before this, the stock has shot up by 4%. Year-to-date (YTD) in 2025, the stock has gained 12.79% in 2025. Nifty 50 index has gained 8.28% in this period. Titan’s stock has outperformed the Nifty 50 index by around 4% in 2025.

Titan is a constituent of Nifty Consumer Durables index. Its weight in the index is 33.96%. The second biggest weight in the index is of Dixon Technologies, at 16.91%.  Year-to-date in 2025, Nifty Consumer Durables index is down by 11.22%.

Gold prices may remain high until economic, geopolitical uncertainty is reduced

Gold prices are likely to remain high until the economic and geopolitical uncertainty at the international level does not come down. With the recent Hamas – Israel truce coming into force, this uncertainty has come down marginally. If a ceasefire is reached between Ukraine and Russia, then gold prices may come down significantly. The risk of trade war between US and other large countries escalating may push up gold prices even further.

Gold prices in India also get impacted by the exchange rate of rupee against the dollar.  In the past one year, gold prices have increased by around 53% in the international market. In the Indian market it has increased by more than 60%. The higher increase in Indian market is mainly because of the depreciation in rupee against the dollar of more than 5% in the past one year.

Titan’s share price near 52-week high

Titan’s stock is currently trading near its prevailing 52-week high of Rs 3,740. Many think it may breakout once again and touch higher 52-week highs. But you never actually know.

Disclaimer : This content is only for informational purpose. It does not make any recommendation to act or invest.

Source: NSE, Infosys