Broker's call: Page Industries (Buy)

| Updated on September 07, 2021

Emkay Global

Page Industries (Buy)

Target: ₹37,500

CMP: ₹32,078

Page Industries has made a good comeback after the pandemic and now offers better growth momentum after the slowdown in FY19-20.

We expect normalised mid-teens growth ahead, driven by structural opportunity and faster growth in athleisure (about 33 per cent of sales); increased focus on the under-penetrated women’s and kids segments with a separate team and scale-up in offerings; accelerated network expansion (40 per cent addition in the last two years), the benefits of which are yet to kick in.

In addition, a comparison of 10 innerwear players highlights a lack of meaningful success by competitors in the premium segment, as well as Page’s unmatched brand and distribution strengths. We are optimistic about PAGE delivering higher growth and forecast a 34 per cent EPS CAGR with a margin gain of 410 bps over FY21-24 (+110bps vs. FY19). Reiterate Buy with a September 2022 target price of ₹37,500, valuing the company at 55x September 2023 EPS – in line with other large high-growth peers – which is justified by its wide moats and best-in-class ROCEs. Delay in recovery and slower market share gains remain key risks to our forecasts.

Published on September 07, 2021

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

This article is closed for comments.
Please Email the Editor

You May Also Like