Shares of Page Industries hit a 52-week high on Friday after the Jockey-brand apparel manufacturer reported a strong jump in net profit for first quarter of FY23, as most analysts turned bullish on the stock.
The Page Industries stock opened on a strong note on BSE at ₹49,799.95 and rose further to hit a new 52-week high of ₹50,338.05. However, due to profit taking, the stock closed below the ₹50,000-mark to end at ₹49,192.60 — a gain of just 0.17 per cent over the previous day's close of ₹49,122.05.
Net jumps multifold
Page Industries Ltd on Thursday reported a sharp increase in its net profit at ₹207.04 crore for the quarter ended June 30, 2022 against ₹10.95 crore posted in the year-ago quarter. Its revenue from operations during the quarter under review was ₹1,341.27 crore (₹501.54 crore).
According to analysts, retail expansion and healthy capacity expansion plans bode well for the company.
Centrum Broking said: "We believe Page is operating in a virtually monopolistic industry where the second best competitor is at 1/10th of its scale. Strong retail footprint expansion, healthy pricing power and solid leadership in place should allow Page to grow it sales at 33/21 per cent each for FY23/FY24." The domestic brokerage increased the target price to ₹59,775 from ₹51,300.
Listening to Page’s management is refreshing – no major concern of (consumer) slowdown, managing (high) inflation well, addressing a large opportunity, etc, ICICI Securities said and added: "That’s the good part of select consumer discretionary names (lower impact of top-down issues). Importantly, its execution on new avenues has been impressive." ICICI Securities, too, revised its target price higher to ₹52,000 from ₹46,000.
However, some brokerages still maintain Neutral on the stock, as "the stock has already priced in the key positives."
Motilal Oswal Financial, which maintained its Neutral stance with a higher price target of ₹46,450, said: “While the outlook remains robust, we maintain our Neutral rating on account of its rich valuation.”
Emkay Global downgraded the stock to Hold from Buy with a revised price target of ₹53,100 (₹47,800). It has maintained the FY24/25 EPS estimates, as they are about 10 per cent higher than consensus. "While Page Industries offers medium-term potential of mid-teens growth but it is largely factored-in, in our view," it added.