Sharekhan recommended Hold rating on Kewal Kiran Clothing with a target price of Rs 1415 in its research report dated May 07, 2019.
Sharekhan's research report on Kewal Kiran Clothing
KKCL reported a good revenue growth of 11% y-o-y to Rs. 133 crore led by double-digit volume growth of 10.5% in Q4FY2019. Gross margins showed exceptional improvement whereas, though operating margin declined by 125 BPS, KKCL maintained its 20% margin target. Flagship brand Killer and Easies performed well, but an expected turnaround in Page 3 Lawman and increase in contribution from recently acquired Desi Belle would help drive revenue growth in coming quarters.
We maintain our Hold rating on the stock of KKCL with an unchanged PT of Rs. 1,415, as consistent volume growth will be a key trigger for the company and we advise long term investors to stay invested in the stock, given its lean balance sheet.
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