Neutral Relaxo Footwears; target of Rs 810: Motilal Oswal

Motilal Oswal recommended Neutral rating on Relaxo Footwears with a target price of Rs 810 in its research report dated May 12, 2023.

Broker Research

May 15, 2023 / 14:49 IST

Neutral

26 Aug, 2025 12:21

Volume

Todays L/H

Motilal Oswal's research report on Relaxo Footwears

RLXF’s price cuts in the last few quarters have translated into healthy market share recovery from the unorganized players, driving healthy 24% volume growth. Subsequently, revenue/EBITDA increased 10%/6% YoY (in line). The 200bp YoY decline in gross margins was due to the price reduction. The cleanup of old high-priced inventory and the steady costs of raw materials could potentially lead to growth and improved margins in the future. We have largely maintained estimates building Revenue/PAT CAGR of 18%/53% over FY23-25. RLXF has a strong cash generation capability, with a historically healthy 20%+ RoEs. The stock trading at 60x FY25 P/E appears rich, hence, we reiterate our Neutral rating on the stock.

Outlook

We ascribe a P/E of 55x on FY25 EPS to arrive at our TP of INR810. We reiterate our Neutral rating on the stock.

For all recommendations report, click here