Monte Carlo Fashions Limited - Q3FY23 Business Update

Monte Carlo Fashions Limited has announced that the company continue to witness strong demand across all its verticals. Company revenue grew at a decent rate despite Q3FY22 being a solid quarter on the back of pent-up demand. The company has recorded strong sales with revenue growth of 12% approx. in Q3 FY23 and 19% approx. for 9MFY23. The quarterly sales have been the best for the company on the back of substantial brand equity among consumers, the latest fashion products and superior quality aided by solid end-of-season sales and encouraging festive season across India. The company maintains its yearly growth guidance of 20%-25% as informed earlier.

As most of its net revenue from franchises, EBOs and MBOs are sold on pre-order or outright, inventory risk is minimised, consequently helping MCFL remain insulated from hazard sales in the branded apparel business. The company's limiting sales return strategy has aided more qualitative growth. The company has been continuously focussing on all-inclusive growth. Despite the higher raw material prices, the company has strategically tackled the volatility by optimising the product mix, passing on the costs to consumers and rationalising overheads. The company has consistently improved its product mix based on early fashion trends and attractive price points. This has been garnering fair market share by the company.

The trade show for Summer 23, conducted in Sept 2022, witnessed healthy traction; this has helped build a robust order book. The company continues to strengthen both its cotton and woollen portfolio simultaneously thus building resilience and strength in its operations.

During the quarter, the Company continued with its strategy of strengthening its retail presence in India by opening 13 new EBOs during Q3FY23, out of which 7 EBOs were opened in the Northern Region, 2 EBOs in the Central region and 4 EBOs opened in Eastern Region. With this, the total number of EBOs has reached approximately 347 across 20 states and four union territories. The company maintains its yearly growth guidance of opening 40-45 new EBOs as informed earlier.

We are also pleased to share that in line with our digital focus to build robust processes and to enhance customer experience, the company is in final stage of implementing SAP S/4HANA solution - Fashion and Vertical Business and will be implemented by first week of February, 2023. This is an intelligent ERP providing real-time insights in all areas of the business and predictive consumer trend insights. This will enhance our flexibility and agility to deliver end-to-end customer experiences and at the same time achieve significant bottom-line cost savings. Monte Carlo maintains its first mover's streak to implement such kind of digital solutions in the industry.

The Company also has a presence through MBOs and distributors, NCS, and is on most major online platforms like Ajio, Amazon, Flipkart, First Cry, Myntra and Kapsons, as well as its own website. The Company continues to witness encouraging trends through its online channels.

The Company's core competency lies in understanding consumer demand trends, manufacturing superior quality products, and keeping up to date with the latest fashion. With these strengths, the Company can effectively leverage the benefits of having a solid distribution network and more than three decades of expertise in the garment industry. The Company is confident of its long-term sustainable and profitable growth, which will benefit all its stakeholders and lead to long-term value creation.

The above information for the period ended quarter ended 31st December 2022 is provisional and subject to Limited Review by the Company's Statutory Auditors.

Shares of Monte Carlo Fashions Limited was last trading in BSE at Rs. 671.20 as compared to the previous close of Rs. 667.40. The total number of shares traded during the day was 535 in over 113 trades.

The stock hit an intraday high of Rs. 676.00 and intraday low of 665.05. The net turnover during the day was Rs. 359837.00.

Source : Equity Bulls

Keywords

MonteCarloFashions INE950M01013 BusinessUpdate Q3FY23 9MFY23