Global brokerage house CLSA is positive on Aditya Birla Fashion that was one of the biggest gainers in FY19, climbing nearly 50 percent.
"We see a robust 30 percent EBITDA (earnings before interest, tax, depreciation and amortisation) CAGR over FY18-21," said the research firm which has maintained buy call on the stock with a price target at Rs 265, implying a 20 percent potential upside from current levels.
The company is aimed to establish itself as the No 2 player in the innerwear segment and its balance sheet is on an improving trajectory, said the brokerage house.
It expects company's share of mature Pantaloons stores to rise to 70 percent in FY21 from 49 percent in FY18 and innerwear segment has seen aggressive expansion.
"We see large value creation potential from the innerwear segment," CLSA said, adding volatility from high operating and financial leverage are key risks.