Aditya Birla Fashion & Retail Ltd - Q2 FY21 Result Update - YES Securities

Aditya Birla Fashion & Retail (Q2 FY21) - (CMP Rs53, MCap Rs127bn)

Quarter Highlights - Revenue saw some progressive recovery after falling to 16% in 1Q to 45% of previous year in 2Q driven by creation of new products (masks, work from home wear, athleisure) and channels (multiple digital channels); 58% revenue decline in Madura, 60% in Pantaloons, +ve in innerwear; strong margin expansion in Pantaloons; 95% stores operational by 2Q-end but footfalls still low; EBITDA breakeven achieved given aggressive cost optimization with 417crs of cost savings; PAT loss of 188cr vs 410cr in 1Q; advancement of new store openings in both Madura (100) and Pantaloons (7) in the quarter; 1500cr capital infusion from Flipkart and 1000cr from rights issue; net debt 3159 crs and WC 1277crs; target net debt of 2000-2200 cr by year-end before Flipkart capital.

- Valuation and view - The stock is currently trading at 38x FY23 P/E and 13x EV/EBITDA. The recent fund raising exercise should take of the balance sheet issues in the near term but given the high cost structure and aggressive expansion plans in an uncertain demand environment, the expected re-rating journey might not be all that smooth with volatility in earnings. We would advise to be cautious on the stock till we get more concrete signs of normalcy and would prefer Trent and V-Mart over ABFRL for now.YES Securities - Aditya Birla Fashion & Retail (Q2 FY21) - 20201109

Shares of Aditya Birla Fashion and Retail Ltd was last trading in BSE at Rs.150.8 as compared to the previous close of Rs. 153.15. The total number of shares traded during the day was 143461 in over 4075 trades.

The stock hit an intraday high of Rs. 155.15 and intraday low of 150.05. The net turnover during the day was Rs. 21755392.

Source : Equity Bulls

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