Buy Aditya Birla Fashion and Retail, target price Rs 360: Emkay Global

Emkay Global has buy call on Aditya Birla Fashion and Retail with a target price of Rs 360. The current market price of Aditya Birla Fashion and Retail is Rs 260.65. Time period given by analyst is one year when Aditya Birla Fashion and Retail Ltd. price can reach defined target.

Aditya Birla Fashion and Retail Ltd., incorporated in the year 2007, is a Large Cap company (having a market cap of Rs 24522.52 Crore) operating in Retail sector.

Aditya Birla Fashion and Retail Ltd. key Products/Revenue Segments include Apparels, Homemart & Accessories, Commission, Scrap, Export Incentives, Other Operating Revenue and Other Services for the year ending 31-Mar-2021.



Financials
For the quarter ended 31-03-2022, the company reported a Consolidated Total Income of Rs 2309.55 Crore, down -23.31 % from last quarter Total Income of Rs 3011.40 Crore and up 25.57 % from last year same quarter Total Income of Rs 1839.24 Crore. Company reported net profit after tax of Rs 30.76 Crore in latest quarter.

Investment Rationale
Expect higher gross margin profile of ethnic to offset RM pressures in SA operations. Structural cost savings and operating leverage should offset ethnic investments, leading to stable EBITDA margins at ~15% vs. pre-Covid. Expect flat interest costs of Rs0.9bn vs. pre-Covid levels

Promoter/FII Holdings
Promoters held 56.09 per cent stake in the company as of 31-Mar-2022, while FIIs owned 13.19 per cent, DIIs 19.51 per cent.