Target: ₹44,916

CMP: ₹38,342.10

Page Industries’ revenues declined by 10 per cent y-o-y (volumes: -9 per cent & realisation: -1 per cent) to ₹1,125 crore, marginally below our estimate of ₹1,155 crore. Decline in volumes was on largely on account of muted demand environment and high base effect. Gross margins stood at 55.7 per cent, -11/+270bps y-o-y/q-o-q.

With benign RM prices we expect GM to stable. Better overheads management led to EBITDA margins improvement by 180/130bps y-o-y/q-o-q to 20.8 per cent. Keeping muted demand environment in context we have accordingly cut our EPS estimates by 1/0.4 per cent for FY24/FY25. As highlighted in our past channel check

note, demand for athleisure segment has moderated from a very high base of last two years (as people stopped WFH and started going back to the offices) and increased competitive intensity (as supply chain got normalised for other players).

Company had delayed implementing ARS system at MBOs during the pandemic as supply chain situation remained crunched. However, management decided to implement the system starting Q3-FY23 as it is expected to help improve long term business performance.

We maintain Add rating with reduced target price of ₹44,916 – valuing at 55x (earlier 60x) H1-FY26E EPS

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