Safari Industries (India) Ltd. share price target

Maintain our BUY rating with a revised TP of Rs 1100/share (previously Rs 925/share) as we value the stock at 45x PE FY24E.

We present an investment idea on Safari Industries with a fair value in the range of Rs 980-1,100. The company has undergone a paradigm shift after Mr Jatia acquired a majority stake and revamped the company's strategy and business operations. Over the years this has led to the company's turnover increasing ~10x and market share improving from a dismal 2% to 18%. Currently, Safari Industries is the single largest brand in terms of sales volume. We believe the company is in a sweet spot to capitalize on growth with economies opening up and massive shift from unbranded/unorganized to branded...

We maintain our BUY rating and value the stock at 45x P/E on its FY24E EPS (premium to its peer) as we expect Safari to report strong growth over FY21-24E. Our revised TP is Rs 900/share (earlier Rs 790/share).

Safari Industries reported better than expected Q1FY22 result. Its sales/ EBIDTA were significantly above our estimates. Safari Industries' net sales increased by 5x YoY to Rs1,202 mn on a very weak base of Q1FY21. Even EBIDTA improved to Rs71 mn compared to loss in Q1FY21 and interest cost fell 49% YoY to Rs10 mn. Hence, net profit improved to Rs25 mn (loss of Rs193 mn in Q1FY21), but fell 60% QoQ as restriction in travel affected not only top-line but also logistics costs. We raise our FY22/FY23 sales/EBITDA estimate by 23%/17% as we anticipate the improvement in travel and tourism which in turn should lead to higher luggage sales....

We revise our rating to BUY (from HOLD earlier) with a revised TP of Rs 790/share as we value it at PE of 45x on its FY24E

Safari Industries (SAFARI) Q1FY21 result was an all round miss versus our estimates. Q1 which is typically a peak season for the company was adversely hit by the pandemic leading to a revenue decline of 90% YoY tp Rs. 20cr (Rs. 50cr our estimate).

Strong growth in revenue: For Q2FY2019, Safari Industries (Safari) posted a strong yoy growth of 44% in revenue to `127 cr mainly led by volume growth. The company is garnering market share from the unorganized market and seeing good demand in its backpacks and new categories which is driving such strong growth in its top line. Margins we..

Robust growth in revenue: For Q1FY2019, Safari Industries (Safari) posted a yoy growth of 49% growth in revenue mainly led by volume growth and low base effect (Q1FY2018 revenue was subdued due to GST impact). The company has reported net revenue of `156 cr which was the highest ever revenue achieved. The company is garnering market share..

Robust Q4FY2018 results- For Q4FY2018, Safari Industries (Safari ) posted a growth of 26%/150% yoy growth in revenue/ PAT amid ~543 bps yoy expansion in operating margin expansion. The company is gaining market share especially from the unorganized players and seeing good demand in its backpacks and new categories which is driving such st..

Safari Industries Ltd (Safari ) is the third largest branded player in the Indian luggage industry. Post the management change in 2012, it has witnessed complete restructuring in business and product portfolio. This restructuring has helped it in posting a CAGR of 42% in revenue and 46% in PAT over 2012-17. It has also now captured ~14%..