Accumulate Page Industries; target of Rs 25052: Dolat Capital

February 14
18:24 2020

Dolat Capital’s research report on Page Industries

Page Industries’ results were below our estimates. The company exhibited worst volume performance with 2.8% de-growth compared to 12.1%/9.1% reported in Q3FY19/Q2FY20. During Q3FY20, most of the company’s in the innerwear industry reported muted sales growth – Lux (+7%), Dollar (+4%) and Rupa (+5%). This implies that the overall industry has witnessed slowdown during the quarter. We attribute this to delayed winter and unfavorable base. Decline in GM and investment in technology hampered operating margins. We continue to believe that Page has all levers in place to post strong volume growth once the economic condition stabilizes. Going ahead, we believe that the new product launches in men, women and kid’s category and impetus to increase penetration especially in kid’s category, will potentially help the company to gain market share. Revival in domestic demand is a key for volume growth.


We have downward revised our EPS estimates for FY20E and FY21E at ` 351 and ` 420 respectively and FY22E at 501. Consequently, we downgrade the stock to Accumulate. Buy on dips. (TP 25,052; 50x FY22E; scarcity premium due to business profile).

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