Pantaloon Retail India - Slow but definite progress - AXIS Securities

Pantaloons Retail (PRIL) core retail revenue grew ~10% YoY (highest in last 5 quarters) to Rs 32 bn in Dec quarter (in line), aided by festive season sales. Encouraging same-store-growth (SSG), both in lifestyle (~13%) and value retailing (5%), is indicative of improving consumer sentiments. Core retail debt at Rs 67 bn (Rs 71 bn in Sep '12) and debt restructuring lowered interest cost. However, higher depreciation (up 25% QoQ to Rs 1.2 bn) led to core retail PBT of Rs 66 mn vs. our est. of Rs 260 mn.

We revise downwards our earnings estimates to factor in higher depreciation expense and change in FY to Dec-end. Thus, core retail earnings (excl.Pantaloons format) stands at Rs 352 mn (Rs 531 mn earlier) for CY13 and at Rs 1,057 mn (Rs 2,037 mn earlier) for CY14.

Source : Equity Bulls

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