Vedant Fashions’ PAT/EBITDA growth remained soft at 5%/8% YoY (10%/8% miss) as subdued revenue growth persisted despite the festive period. Revenue growth of 7% YoY was mainly supported by footprint addition; same store sales declined 2.1% YoY in 3QFY24. Given the weak outlook and soft management commentary, we have cut revenue/PAT by 5%/3% for 25, factoring in revenue/PAT CAGR of 10%/11% over FY23-25, mainly driven by footprint expansion. The stock is trading at valuations of ~51x P/E on FY25E after the recent correction.
OutlookHowever, concerns around demand revival would remain a key monitorable for any re-rating. We reiterate our Neutral stance on the stock with a TP of INR1,200, valuing it at 45x P/E on FY26.
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