Rekha Jhunjhunwala faces Rs 800 crore loss as Titan shares tumble

PTC Web Desk: Rekha Jhunjhunwala, wife of the late investor Rakesh Jhunjhunwala, faced a substantial setback on Monday as the shares of Titan Company, a significant investment for the Jhunjhunwalas, experienced a significant decline. Titan, a leading firm under the Tata Group umbrella, represents a cornerstone of the Jhunjhunwalas’ investment portfolio, with Rekha Jhunjhunwala reportedly holding a 5.35% stake in the company as of March 31, 2024. Prior to Monday’s downturn, her holdings were valued at Rs 16,792 crore based on the previous Friday’s closing figures.

However, the scenario changed drastically on Monday as Titan shares plummeted over 7% following the release of disappointing earnings for the March quarter, failing to meet investor expectations. The stock hit a low of Rs 3,352.25 during trading hours before closing at Rs 3,281.65 on the Bombay Stock Exchange. Consequently, the company’s market capitalisation dipped below the Rs 3 lakh crore threshold to Rs 2,91,340.35 crore, erasing more than Rs 22,000 crore from its value.

This downturn had a direct impact on the value of Rekha Jhunjhunwala’s stake in Titan, which was estimated to be around Rs 15,986 crore following Monday’s decline, as per reports from Hindustan Times. The latest earnings report from Titan for the March quarter showcased a 5% increase in consolidated profit after tax (PAT), amounting to Rs 771 crore compared to ₹736 crore in the corresponding period of the previous fiscal year.

Despite this growth in profit, Titan’s performance fell short of market estimates, with its jewellery segment experiencing a margin miss of 70-100 basis points and higher subsidiary losses, according to a report by Emkay Research. The company’s total income for the fourth quarter rose to Rs 11,472 crore from Rs 9,419 crore in the previous fiscal period, reflecting a healthy uptick. For the entire fiscal year 2023-24, Titan reported a consolidated PAT of Rs 3,496 crore compared to Rs 3,274 crore in the preceding fiscal year, indicating overall growth.

The company’s total income for FY24 stood at Rs 47,501 crore, a notable increase from Rs 38,675 crore in the 2022-23 fiscal year. Despite the positive trajectory in total income and profit, the market’s reaction to the quarterly performance led to a significant decline in Titan’s share price and market capitalisation, ultimately impacting the wealth of major shareholders like Rekha Jhunjhunwala.

The Jhunjhunwala family’s association with Titan dates back years, with Rakesh Jhunjhunwala, often referred to as the “Big Bull” of the Indian stock market, having made significant investments in the company over time.