Motilal Oswal's research report on DreamFolks
DreamFolks (DFS) posted a revenue growth of 8.8% YoY to INR3.5b, in line with our estimate of INR3.5b. Gross profit was up 24% YoY to INR466m, with a gross margin of 13.3% (up 210bp QoQ). EBIT margin came in at 7.5%, up 60bp YoY. Consolidated PAT was INR213m (up 24% YoY), above our estimate of INR193m, with a PAT margin of 6.1%. The company’s revenue/EBITDA/ PAT grew 8.8%/18%/24% YoY in 1Q. We expect its revenue/EBITDA/PAT to grow 5.3%/8.4%/19.6% YoY in 2QFY26.
Outlook
We see that the company will also continue to invest in non-lounge service as a diversification drive, which can provide revenue stability in the medium term. We value DFS at INR160 per share (implying a 28% potential upside), at 10x Mar’27E EPS. Reiterate BUY.
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