Nov 13, 2012, 06.27 PM | Source: Moneycontrol.com
Angel Broking is bullish on Page Industries and has recommended accumulate rating on the stock with a target of Rs 3602 in its November 9, 2012 research report.
, Angel Broking |
“Page Industries’s for 2QFY2013, Page Industries (Page) reported numbers in line with our expectations on all fronts. The company's top-line grew by 21.9% yoy to Rs220cr from Rs181cr in the same quarter last year, in-line with our estimate of Rs215cr for the quarter. The EBITDA margin for the quarter expanded marginally by 30bp yoy and came in at 20.0%, against our estimate of 20.2%. Consequently, the company reported a profit of Rs31cr, 21.4% higher yoy from Rs25cr in 2QFY2012, in line with our estimate of Rs30cr.”
“According to industry reports, the Indian innerwear industry stood at Rs14,000cr (in FY2011) and is expected to grow at CAGR of 13.2% to Rs43,700 by FY2020. The innerwear market in India is underpenetrated with per capita spend significantly lower than other Asian peers which provides huge opportunity to the company. With a market share of 21% in men’s segment and 12% in women’s segment, we expect Page to use the opportunity and report a revenue CAGR of 22.3% to Rs1,023cr in FY2014E. This is also backed by the strong brand image and pan India distribution channel consisting of 400 distributors, 72 Exclusive JOCKEY outlets and ~23,000 retail outlets across 1,200 cities.”
“Expecting the company’s revenue and profit to grow at a CAGR of 22.3% and 28.5% FY2012-14E over to Rs1,023cr and Rs149cr respectively in FY2014E and considering its robust RoE profile, we have assigned a P/E multiple of 27x for its FY2014E earnings. The stock is currently trading at a PE of 25.2x FY2014E earnings. We upgrade the stock to accumulate with a target price of Rs3,602, valuing the stock at 27x FY2014E earnings,” says Angel Broking research report.
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