Buy Talwalkars Better value Fitness; target of Rs 241: IIFL

“Talwalkars Better Value Fitness (TBVF) is amongst the largest fitness chains in the country operating 66 health clubs (including JVs/franchisees), serving over 55,000 members. Incorporated in April ’03, the company offers diverse suite of services including gyms, spas, aerobics and health counseling. Although TBVF operates in a fragmented and competitive market, it has ample room for growth on account of 1) under-penetrated membership rates 2) favourable structural factors and 3) pan-India presence. It plans to add 38 owned gyms in FY11 partly funded by IPO proceeds. Based on cumulative additions of 68 gyms in FY11-12 and estimated annual accrual of Rs 20 million per gym, we project a 4-fold jump in PAT over the next two years. Recommend BUY,” says IIFL research report.

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