Buy TCNS Clothing, target price Rs 1050: Emkay Global

Emkay Global has buy call on TCNS Clothing Co. with a target price of Rs 1050. The current market price of TCNS Clothing Co. Ltd. is Rs 801.9. Time period given by analyst is one year when TCNS Clothing Co. Ltd. price can reach defined target.

TCNS Clothing Co. Ltd., incorporated in the year 1997, is a Mid Cap company (having a market cap of Rs 4947.67 Crore) operating in Apparels sector.

TCNS Clothing Co. Ltd. key Products/Revenue Segments include Apparel and Other Operating Revenue for the year ending 31-Mar-2021.



Financials
For the quarter ended 30-09-2021, the company reported a Standalone Total Income of Rs 254.15 Crore, up 162.58 % from last quarter Total Income of Rs 96.79 Crore and up 65.57 % from last year same quarter Total Income of Rs 153.50 Crore. Company reported net profit after tax of Rs 11.07 Crore in latest quarter.


Investment Rationale
As TCNS delivers on earnings expectations (~40% CAGR over FY20-24E), it should narrow down the 30-75% valuation discount vs. peers. Given the robust supply chain, penetration potential and strong online presence, the brokerage retains Buy with a TP of Rs1,050.

Promoter/FII Holdings
Promoters held 32.28 per cent stake in the company as of 31-Dec-2021, while FIIs owned 17.63 per cent, DIIs 6.58 per cent.