Arvind Fashion's (AFL) strategy of focusing on its core profitable brands and strengthening the balance sheet is expected to aid profitable growth while maintaining leverage at reasonable levels. According to the management, the latest capital raising (Rs. 439 crore) from 17 marquee investors and promoters is the final leg of its restructuring phase. The management has indicated that this preferential allotment would enable it to significantly deleverage its b/s and adequately fund its future growth aspirations. We believe that restructuring of brand portfolio and b/s are steps in the right direction. We expect profitable growth with prudent capital allocation to result in debt/EBITDA ratio (pre-Ind-AS) declining to 2.5x by FY23E.
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Shares of Arvind Fashions Limited was last trading in BSE at Rs. 270.55 as compared to the previous close of Rs. 261.8. The total number of shares traded during the day was 1499645 in over 6101 trades.
The stock hit an intraday high of Rs. 276.8 and intraday low of 255.15. The net turnover during the day was Rs. 394213548.