Welspun Living shares rise 4% as Jefferies starts coverage with 'buy' rating

Welspun Living shares rise 4% as Jefferies starts coverage with 'buy' rating

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Shares of Welspun Living rose 4% on June 5 after global brokerage firm Jefferies initiated coverage on the firm with 'buy' rating.

"Welspun Living has expanded over time, entering new categories and building a branded play, and should deliver 18% EPS CAGR over FY25-28e, even as FY26 would be muted due to near-term tariff uncertainty," said the brokerage.

At 10:13 am on June 5, Welspun Living shares on NSE were trading 4.2% higher at Rs 139.65 apiece. The 52-week high of the stock is Rs 212.95 and 52-week low is Rs 104.8. The market capitalisation of the stock is Rs 12,500 crore.

Jefferies gave a target price of Rs 185 for the stock, which implies up to 32% upside from the current market price.

The company has market leadership in textile exports and has a strong client base, including long-term partnerships and deep supply chain integration with US retail giants Walmart and Costco, CNBC-TV18 reported Jefferies as saying in a report. The company is also looking to expand to other markets such as the UK, European Union, Gulf Cooperation Council countries, Japan, Australia, and New Zealand, which have shown higher growth in recent times, the report added.

The brokerage expects Welspun to be a major beneficiary of India's potential free trade agreements with the US and the European Union, similar to the one finalised with the UK.

The company reported 9.7% year-on-year decline in net profit at Rs 131.8 crore, compared to Rs 146 crore in the year-ago period.

Revenue for the quarter stood at Rs 2,646 crore, up 2.7% from Rs 2,575.2 crore a year ago. EBITDA fell 12% YoY to Rs 316 crore, as against Rs 358.6 crore in Q4FY24.