Up to 230% returns in a year, should you add Titan, Kalyan Jewellers, and other jewellery stocks to your portfolio?

Titan Company has given a return of over 28 per cent in a year. However, from a long-term view of five years, the stock has rallied over 257 per cent.

Listed in July 2023, Senco Gold has also been moving fast and has risen over 72 per cent in the just three months, image- Reuters

Kalyan Jewellers, Thangamayil Jewellery, Senco Gold, and Titan Company are a few of the jewellery stocks that have shined in a year while giving investors up to 230 per cent returns. Kalyan Jewellers India has gained over 230 per cent in a year, and Thangamayil Jewellery has rallied over 180 per cent.

Listed in July 2023, Senco Gold has also been moving fast and has risen over 72 per cent in the just three months. Titan Company has given a return of over 28 per cent in a year. However, from a long-term view of five years, the stock has rallied over 257 per cent.

So what's boosting the rally in these jewellery stocks?

According to analysts, many factors have driven the rally:

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-Festivals like Diwali, Dusshera, and Dhanteras boosted market sentiment.

-Geo-political tensions in the Middle East.

- Interest rate hikes to curb inflation.

"The persistently high inflation has attributed to a strong spike in gold prices, resulting in improved price realisation," said Ravi Singh, Market Expert.

Should investors have these jewellery stocks in their portfolios?

According to market expert Ravi Singh, Kalyan Jewellers India looks attractive.

"Kalyan Jewellers looks more attractive on fundamental and technical parameters. The robust Q2 earnings performance has added more fuel to the rally. Long-term moving averages are trading below the prices, supporting the upward trend. The stock may touch the levels of 380 in the short- to medium-term perspective," said Singh.

Vaibhav Kaushik, Research Analyst, GCL Broking, is also bullish on Kalyan Jewellers, but he also recommends adding Titan to the portfolio.

"We can see after the government has done compulsory hallmarking for jewellery, this sector has the most chances to become an organised sector from an unorganised sector. Still, this sector has lots of chances to grow at a rate of more than 20 per cent," said Kaushik.

He recommended buying Titan Company's shares for a target price of Rs 4,200 apiece and Kalyan Jewellers for a target of Rs 470 apiece.

Conversely, ICICI Securities has downgraded Kalyan Jewellers India from 'buy' to 'add' at the current valuation for a target price of Rs 360 apiece.

Brokerage firm Emkay has given a 'buy' call on Senco Gold for a target price of Rs 800 apiece. The brokerage believes that the company's long-term levers in terms of product differentiation, penetration, and non-east expansion remain in place.

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