Buy Campus Activewear; target of Rs 330: Motilal Oswal

Motilal Oswal is bullish on Campus Activewear recommended buy rating on the stock with a target price of Rs 330 in its research report dated May 29, 2025.

Broker Research

June 03, 2025 / 14:53 IST

Buy

26 Aug, 2025 12:21

Volume

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Motilal Oswal's research report on Campus Activewear

Campus Activewear (Campus) delivered a healthy 12% YoY revenue growth, led by 8% increase in volumes and higher ASPs, supported by price hikes in open footwear and increased outright sales online. EBITDA grew 12% YoY (7% beat), with margins stable at 17.6%, as increased A&P investments offsets better gross margin (+185bp YoY). Campus delivered a 10% YoY revenue growth in FY25, with EBITDA rising 16% YoY, driven by a 70bp margin expansion. This was achieved despite lower ASPs and the impact of non-BIS inventory liquidation, as FY24 was impacted by one-off provisions on inventory and receivables. Management indicated that while demand trends improved slightly, they remained subdued; however, Campus was able to grow its market share. With an improvement in the demand environment, the company expects to return to mid-teen growth and deliver margins within the guided range (17-19%).

Outlook

We raise our FY26-27E earnings by 5-10%, driven by higher volume growth and EBITDA margin expansion to ~19% by FY27. We build in a CAGR of 15%/28%/35% in revenue/EBITDA/PAT over FY25- 27. We reiterate our BUY rating with a TP of INR330, premised on 45x Mar’27 P/E.

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