Sharekhan's research report on Relaxo Footwear
Company undertook timely price cuts of 13-15% in key value-for-money brands and increased focus on close-ended footwears to revive growth in the quarters ahead. Key input prices corrected from highs (EVA prices fell by 45% from highs) and the benefits of same would start flowing in the quarters ahead. Scale-up in contribution of close-ended footwear, better penetration through EBOs, renewal of 40% of portfolio every year and increased contribution from e-commerce channel would help volumes grow consistently in high single digit to low double digit.
We maintain a Buy on Relaxo Footwear (Relaxo) with revised price target of Rs. 1,185. Stock trades at 80.6x and 59.6x its FY2024E and FY2025E, earnings. Drivers are in place to achieve consistent earnings growth and improving return profile.
At 15:31 hrs Relaxo Footwears was quoting at Rs 1,020.00, up Rs 6.40, or 0.63 percent.
It has touched an intraday high of Rs 1,026.80 and an intraday low of Rs 1,016.05.
It was trading with volumes of 24,408 shares, compared to its thirty day average of shares, a decrease of percent.
In the previous trading session, the share closed up 0.49 percent or Rs 4.90 at Rs 1,013.60.
The share touched its 52-week high Rs 1,447.00 and 52-week low Rs 928.00 on 04 November, 2021 and 12 May, 2022, respectively.
Currently, it is trading 29.51 percent below its 52-week high and 9.91 percent above its 52-week low.
Market capitalisation stands at Rs 25,390.46 crore.
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