In its quarterly preview of Q4FY19, the management highlighted that the jewellery division continued to gain market share despite headwinds impacting the jewellery industry. The division added a record number of Tanishq stores (35) with revenue growth of 22% for FY19. The watches division sustained its healthy performance on the back of new product launches, especially in the smart watch category, resulting in robust revenue growth of 16% in FY19. The management remains optimistic on the growth outlook with the aim of achieving 20% topline growth in FY20E. We model revenue, earnings CAGR of 21%, 27% respectively, in FY18-21E.
OutlookWe reiterate our BUY rating on the stock with a revised target price of Rs 1290 (49.0x FY21E EPS).
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