Page Industries Ltd. share price target

Sector: Apparels /Mid-Cap | Earnings Update 1QFY20 Background: Page Industries is the exclusive licensee of Jockey International Inc (USA) to manufacture and distribute Jockey brand in India, Sri Lanka, Nepal, Bangladesh and UAE till 2040. They broadly operate in premium men's innerwear; women's innerwear and leisure wear segments. Jockey enjoys high brand recall and they spend ~5% of their annual sales for brand building and promotional activity, which enables them to dominate most of the segments in which they operate. In the men's and women's segment, they have a market share of ~21% and ~12% respectively. They are also exclusive licensee of Speedo swimwear brand in India. Page has...

Muted consumer sentiment to impact revenue growth The management highlighted that subdued growth was witnessed across all sub-categories in Q1FY20 with the same trend visible in July as well. The management indicated that weakness was primarily on account of muted consumer sentiment as there was no acceleration in de-stocking in supply chain. On the competition front, the company affirmed its stance that it has not been losing its market share, as it believes the market opportunity is huge and there is enough headroom for all the players to grow. Page is...

Margins surprise, weak sales growth likely to persist Motilal Oswal values your support in the Asiamoney Brokers Poll 2019 for...

Page Industries' continues to report weak performance. The revenues came below our estimate second consecutive quarter of flat to low single digit growth for the company. We attribute this to slowdown in the economy and low footfalls in EBO's. Going ahead, we believe that slowdown in the economy would restrict the company's performance in the near term. nevertheless, new product launches in men, women and kid's category and impetus to increase penetration especially in kid's category would help the company to register double digit growth in...

We met the Mgt of Page Inds to take stock of the current demand scenario and long term growth outlook on the company. Page Inds has extended Jockey from innerwear segment to athleisure and Kids segments which will...

Sector: Apparels /Mid-Cap | Earnings Update 4QFY19 Background: Page Industries is the exclusive licensee of Jockey International Inc (USA) to manufacture and distribute Jockey brand in India, Sri Lanka, Nepal, Bangladesh and UAE till 2040. They broadly operate in premium men's innerwear; women's innerwear and leisure wear segments. Jockey enjoys high brand recall and they spend ~5% of their annual sales for brand building and promotional activity, which enables them to dominate most of the segments in which they operate. In the men's and women's segment, they have a market share of ~21% and ~12% respectively. They are also exclusive licensee of Speedo swimwear brand in India. Page has...

The knitwear market size is likely to grow at a promising rate of 9%, from INR689.3b now to INR1,617b over the next decade. Menswear is the single largest category in knitwear (accounting for 40%), followed by womens wear (34%), boys wear (18%) and girls wear (8%)

Competition, lower offtake by retailers impact sales growth FY19 was a challenging year for Page, with revenue growth tapering to 11.8% YoY (lowest ever sales growth) to | 2852 crore. As per the management, overall slowdown in the consumer demand and de-stocking by retailers (20-40% across certain regions) were major factors that led to deceleration of revenue trajectory. Furthermore, increasing competitive intensity in the premium category might also weighed on growth. The management highlighted that currently it has ~19-20% market share in...

Page Industries reported lackluster performance in Q4FY19. The revenue was significantly below our estimate (17% gr est) the worst performance in the decade. Page's revenue growth was flat and profitability fell 20%. Going ahead, we believe that the slowdown in the economy will pressurize the company's performance in the short term. However, new product launches and efforts to increase penetration will help the company to grow revenue in double digits in the long term. We have revised our estimates from ` 498 and ` 601 in FY20E and FY21E to ` 457 and ` 553, respectively....

4QFY19 flat sales growth of INR6.1b (our est. INR7b), was led by meager overall volume growth of 1% YoY. EBITDA declined 18.5% to INR1.2b (our est. INR1.5b), while Adj. PAT was down 20.4% to INR750m (our est. INR1b). Gross margin expanded 100bp YoY to 63.6%. Yarn costs were stable. EBITDA margin was down sharply 440bp YoY to 19.7%. Employee costs as % of sales were up 430bp YoY while other expenses as % of sales were up 110bp. FY19 performance: Sales/EBITDA/Adj. PAT grew 12%/14%/13%. Overall volumes grew 5.6% for the year. Gross margins were up 60bp YoY to 58% while...