East India Securitie's report on Shoppers Stop
Shoppers Stop (SS) has been a pioneer in Indian retailing since 1991 and has been able to make a mark in the highly competitive retailing market. it is the seventh largest among all listed retail plays and has 266 stores spread over 48 cities. SS has been in losses for the past 3 years primarily because of COVID restrictions however It has seen a strong revival in its financials in FY23 – in 1HFY23 sales are up 131% yoy, EBITDA margin is up 1560bps yoy and PAT has gone to a profit from a loss yoy. The winner which SS identified early is Beauty. Beauty is now 15% of sales. While nurturing its association with big brands, SS has setup its own private label, Arcelia. It is now, also setting up SS Beauty stores which sell all its Beauty assortment.
Outlook
We assign a HOLD rating with target price of Rs654 per share with a target P/E of 30X on FY24 earnings.
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