ABFRL - RESEARCH REPORT

Aditya Birla Fashion and Retail Limited has India’s widest branded fashion network comprising of various brands under different verticals such as Louis Philippe,Van Heusen, Allen Solly, Peter England, Reebok, Forever 21, Simon Carter, and American Eagle under its MFL Brands which cater to India’s premium consumers. Its Pantaloons brand offers a wide variety of styles across categories and occasions. Company’s emerging business consists of emerging brands such as Van Heusen's Innerwear, Athleisure and Active wear, The Collective - India's largest international multi-brand retailer, Ralph Lauren, Hackett London, Ted Baker, Fred Perry, Forever21, and TMRW. Company has also introduced its Ethnic business which showcases renowned brands such as Shantanu & Nikhil, Tasva, Jaypore, House of Masaba, Sabyasachi and Marigold Lane.

Company has 4307 Brand Stores, 446 Pantaloons Stores, 37106 multi-brand outlets and 9,781 shop in shops across dept. stores and 12.2 million Sq.ft. foot print as of Q3 FY24.

Recently the company has also announced plans to vertically demerge its Madura Fashion & Lifestyle business into separate listed entity. The Madura Fashion & Lifestyle business segment (MFL) consists of four lifestyle brands viz Louis Phillippe, Van Heusen, Allen Solly & Peter England along with casual wear brandsviz. American Eagle & Forever 21, sportwear brand Reebok and the innerwear business under VanHeusen. Post Demerger the remaining ABFRL will be focused on high-growth segments where there are tailwinds from a shift from unbranded to branded, premiumization, rise of super premium & luxury, and rapid growth in Gen Z focused digital first brands which includes brands such as Pantaloons, The Collective, GalleriesLafayette & select luxury brands, Ethnic Portfolio and TMRW.

Fundamentals (FY23-24):

CMP	Rs. 232
52 - week high	Rs. 265
52 – week low	Rs. 184
Dividend % (consolidated)	-
ROE	-1.07%
BVPS (Rs.)	35.27
Sales (Rs.) (Q2FY24)	4166 cr.
Debt to Equity	0.69
P/E ratio	-564.08
EPS (consolidated)	- 0.38
P/B ratio	6.08
Market Cap	22,504.81 Cr.
Face value	Rs. 10

Financial Results:

Company’s Net Sales was at Rs 4,166.71 crore in December 2023 up 16.1% from Rs. 3,588.80 crore in December 2022. Its Quarterly Net Loss was at Rs. 77.87 crore in December 2023 down 593.16% from Rs. 15.79 crore in December 2022. Company’s EBITDA stands at Rs. 597.33 crore in December 2023 up 29.14% from Rs. 462.56 crore in December 2022.

Performance of Verticals:

Company’s Lifestyle brands delivered best 9-month profitability – Highest EBITDA for YTDQ3 with Margins at 19.6% vs. 17.1% last year Q3 and EBITDA margin expands by 230 bps YoY with focus on driving growth in high profitability channels and Network expansion in line with the long-term growth agenda along with addition of 36 Net stores in the quarter.

Pantaloons’ Revenue grew by 12% over LY to Rs. 1,297 Cr.; LTL growth @ 3% as Inflation continued to have impact on mid-market segment and Delayed winter resulted in a subdued winter-wear performance. Still the performance is backed by focus on expansion, while improving overall network health and net addition of 7 stores during the quarter.

American Eagle’s Revenue soars by 34% YoY under aggressive network expansion as the brand gains strong salience with consumers and Addition of 10 EBOs to the network this quarter and increased Presence across 100+ departmental doors.

Reebok’s Revenue grew three folds over LY marking another quarter of Rs. 100 Cr. + profitable sales backed by Aggressive store expansion making Net addition of 39 stores in last 12 months. It Scaled up Ecommerce to Rs. 100 Cr+ business at YTD level keeping Brand on track to build a large distribution machinery which is now available at @161 EBOs and 185 Departmental stores.

Company’s super premium brands continues to stay resilient and grow as its Revenue grew by 16% over LY. thecollective.in is poised to build leadership in premium ecommerce space as its Revenue grew by 50% over LY.

Company’s ethnic brand Sabyasachi recorded Strong performance in a weak wedding period as it Crossed quarterly sales of more than Rs. 150 Cr. for the first time by registering 43% growth in revenue with 42% LTL growth and Jewelry continues to be the fastest growing segment with 51% growth YoY. Shantanu and Nikhil’s Total revenue* grew by 30% over LY and the pret label “S&N” grew by 42% over LY with 20% LTL growth on the back of Adding stores at key strategic locations and ending the quarter with 19 stores.

Tasva’s Sales grew ~100% over LY and this was the first wedding season witnessed by the network of 67 stores. The Brand experienced strong consumer traction backed by the profitable model getting established in bigger cities and continuous expansion in key markets by adding 8 stores to the network in recent quarter.

Key Updates:

Tasva, the Indian menswear brand by Aditya Birla Fashion and Retail Ltd. and celebrated designer Tarun Tahiliani has announce the inauguration of its second store in Noida, situated within Gaur City Mall, sixth store in Delhi, situated in DLF Avenue, Saket and 3^rd Store in Jaipur, 5^th store in Mumbai and 1^st store in Faridabad. Tasva has achieved the milestone of 80 stores across the country. This expansion highlights Tasva’s steadfast commitment to offering unparalleled fashion and lifestyle choices to its valued patrons.
Pantaloons has launched its latest campaign, 'Workdrobe,' which celebrates each woman's personal style and encourages her to embrace her authentic self at work.
Jaypore the artisanal lifestyle brand of Aditya Birla Fashion and Retail Ltd. recently launched its Spring Summer ‘24 collection – amalgamating ease and elegance.
Louis Philippe and Van Heusen, two distinguished powerhouses in the fashion world have broaden their international presence with an exciting expansion in Qatar by unveiling two new flagship stores in a strategic collaboration with HK Group to bolster their physical retail footprint and enhance the consumer shopping experience in the GCC region.
Van Heusen recently collaborated with Hungama’s Heftyverse to redefine the online shopping experience by leveraging the power of the 3D world to offer consumers a one-of-its-kind fusion of entertainment and fashion.
Company has partnered with Ingenuity to launch Jaypore, in the US market. Jaypore is a leading artisanal lifestyle brand that offers curated collections of handwoven and handcrafted apparel, jewelry, home textiles and accents, based on craft forms from all over India.
Louis Philippe and Peter England have marked their entry in Mauritius in partnership with Jetha Tulsidas by opening their first-ever exclusive stores in the Republic of Mauritius, bringing their world-class products to the island nation.
JAYPORE, has recently opened its two new stores in Mumbai, located in Oberoi Mall and R City Mall and one in Dwarka, Delhi. This marks a significant milestone in Jaypore's retail footprint expansion with 26 stores across the country.
ABRL has recently announced a partnership with Christian Louboutin, one of the world’s most famous shoe designers known for his high-end footwear and iconic soles. Christian Louboutin has successfully diversified its business into men’s footwear, leather goods & accessories, beauty and kids having retail presence in over 30 countries.
Pantaloons in a historic step towards transforming the fashion retail environment, announced the grand launch of its very first Pantaloons OnLoop store in JP Nagar, Bengaluru. Pantaloons OnLoop is a playful, distinctive, technology-first experiential store, designed for the young and modern customer who is seeking fun and excitement in all they do.
House of Masaba recently announce the launch of their luxury bridal label ‘The Masaba Bride’ with the campaign ‘Patiala Portraits’, starring modern-day royalty Kareena Kapoor Khan.
Louis Philippe has unveiled a brand-new line of luxurious sneakers that redefine style, comfort, and sophistication, catering to the cosmopolitan and discerning consumer. This milestone marks a new era in footwear fashion, seamlessly merging exquisite craftsmanship with cutting-edge design and technology.
Louis Philippe has announced its foray in the Middle East with the grand opening of the brand’s newest outlet in City Centre Deira, Dubai, UAE.
Jaypore recently presented its handcrafted dinnerware collection 'Mausiqi’. Inspired by Mumbai’s architectural marvels such as the `Royal Opera House’, this extraordinary ensemble beautifully captures the essence of the global Art Deco movement that swept through the roaring twenties.
Planet Fashion, part of Aditya Birla Fashion and Retail (ABFRL), has recently unveiled its new retail identies at Jharkhand, Varanasi, Meerut, Dehradun, Assam, Karnataka, Hyderabad, Mumbai, Uttarpradesh and Rajasthan. The brand has 164 stores across India and offers the latest international fashion selections at affordable prices.
ABFRL has acquired controlling stakes in TCNS Clothing, the owner of leading ethnic brands W, Aurelia, Wishful, Folksong and Elleven.

In last 3 Years the stock gave a return of 37.30% as compared to the rise of Sensex and Nifty in the same period.

HET ZAVERI
info@smartinvestment.in

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