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Last Updated : May 17, 2019 04:37 PM IST | Source: Moneycontrol.com

Buy Aditya Birla Fashion and Retail; target of Rs 240: ICICI Direct

ICICI Direct is bullish on Aditya Birla Fashion and Retail has recommended buy rating on the stock with a target price of Rs 240 in its research report dated May 16, 2019.

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ICICI Direct's research report on Aditya Birla Fashion and Retail


ABFRL reported a weak operational performance with numbers coming in below our estimates. A significant increase in advertisement spend and muted revenue growth in Pantaloons division impacted the overall performance. Revenues grew 9% YoY to Rs 1915.3 crore mainly driven by steady growth in lifestyle brands. Higher employee expenses (up 36% YoY to Rs 235 crore) coupled with aggressive marketing spends (~Rs 54 crore higher spend) and one time inventory markdown worth Rs 10 crore, restricted EBITDA growth. EBITDA margins for the quarter fell 280 bps YoY to 6.5%.


Outlook


We believe the growth story remains intact with Q4FY19 being an exception. We reiterate our BUY rating on the stock with a revised target price of Rs 240 (FY21E 1.9x EV/sales).


For all recommendations report, click here


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First Published on May 17, 2019 04:37 pm
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