Buy The Phoenix Mills: target of Rs 1231: ICICI Securities

The research firm ICICI Securities believes earnings of apparel brands and retail companies under their coverage may surprise positively from Q3FY22E as the likely demand recovery may result in better than expected margin performance. Some of the costs savings achieved during pandemic may sustain and coupled with high operating leverage may lead to higher than pre-covid margins from Q3FY22E.  Stocks like Trent, V-Mart and Aditya Birla Fashion and Retail are the preferred picks backed by their strong and consistent track record of execution.

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26 Aug, 2025 12:21

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ICICI Securities research report on The Phoenix Mills

As per company, The Phoenix Mills (PHNX) has clocked mall consumption of Rs6.6bn in Nov’21 which is 116% of Nov’19 levels and Rs6.7bn in Oct’21 which is 91% of Oct’19 levels. While the threat of a fresh round of Covid induced mall closures remains a risk, we expect mall rentals to revert to pre-Covid levels by Q4FY22 as consumption continues to improve. With the company having received an additional Rs7.8bn of liquidity from CPPIB in Nov’21 as the first tranche for The Rise office/retail project in Mumbai, PHNX has cumulatively raised/tied up Rs43.5bn of funding between Q2FY21-Q3FY22. With just Rs13.8bn of net debt as of Nov’21, the company’s strong balance sheet acts as a cushion against any fresh Covid induced rental losses.

Outlook

We reiterate our BUY rating with an unchanged Mar-22 SoTP based target price of Rs1,231/share which includes Phoenix Rise office and retail project of 1.2msf and retain our 10% premium to NAV considering growth opportunities from growth capital raised from GIC PE and CPPIB platform deals. Key risks to our call are a fresh Covid wave impacting mall consumption and fall in mall occupancies and rentals.

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