ICICI Direct's analysis report on Aditya Birla Fashion
Revenues for the quarter de-grew four% YoY to Rs. 1804 crore (I-direct estimate: Rs. 2166 crore). Revenues of Way of life manufacturers (Allen Solly, Van Heusen, Louis Philippe, Peter England) de-grew 7% YoY to Rs. 977 crore (vs. Rs. 1054 crore in Q2FY17). Revenues from Quick Trend, which incorporates Endlessly 21 & Folks, grew 10% YoY to Rs. 97 crore vs. Rs. 88 crore in Q2FY17. Different enterprise that features innerwear & different manufacturers (Collective, Ted Baker) grew 52% YoY to Rs. 45 crore vs. Rs. 29 crore in Q2FY17. Pantaloons revenues for the quarter grew 2% to Rs. 740 crore vs. Rs. 727 crore in Q2FY17.
The quantity of retailer added in Q2FY18 beneath Pantaloons was 30 (~70 in H1FY18), taking the entire depend to 243. The growth impacted the EBITDA margins for Pantaloons, which declined 242 bps YoY to four.7%. Along with the identical, EBITDA for quick style in H1FY18 stood at a loss of Rs. 26 crore as in comparison with Rs. 15 crore in H1FY17. The administration has affirmed its steerage of attaining breakeven in quick style by Q4FY18. We consider that optimistic working leverage on account of retailer resizing, improved assortment might recoup current losses and drastically enhance the longer term income. We count on revenue to just about double to Rs. 114 crore in FY19E as in comparison with Rs. 54 crore FY17. Given the current subdued efficiency we taper our income estimates while sustaining EV/Gross sales a number of of 2x and BUY ranking on the inventory.
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