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Buy V-Mart Retail; target of Rs 4210: Motilal Oswal

Motilal Oswal is bullish on V-Mart Retail recommended buy rating on the stock with a target price of Rs 4210 in its research report dated August 09, 2022.

August 11, 2022 / 03:07 PM IST
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Motilal Oswal's research report on V-Mart Retail


VMART continued its soft performance v/s its listed peers as revenue (excluding Unlimited stores) grew 4% from 1QFY20 levels to INR4.7b, with a 25% decline in sales per sq. ft. A 660bp improvement in gross margin and cost optimization led to 54% growth in EBITDA over 1QFY20 levels. The ensuing price cuts before its festive sale, but weakness in rural India will lead to some pain over the next few quarters. We have factored in a revenue/EBITDA CAGR of 40%/50% over FY22-24. However, a turnaround in rural India will be key. We maintain our Buy rating.


Outlook


We arrive at our TP of INR4,210, assigning 18x EV/EBITDA on a Mar’24 basis. We maintain our Buy rating.


For all recommendations report, click here

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V-Mart Retail - 100822 - moti

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first published: Aug 11, 2022 03:02 pm
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