These companies operate prominent retail chains offering apparel and lifestyle products across India. This article will present analyst recommendations highlighting significant upside potential for select textile stocks, including specific buy calls with projected gains of 10-20% based on recent brokerage reports.
Aditya Birla Lifestyle Brands Ltd. rose up 2.32% to Rs. 158.85 from its previous close of Rs. 155.24, taking its market capitalisation to Rs. 19,054.90 crore, while Vishal Mega Mart Ltd. climbed 2.1% to Rs. 139.99 from Rs. 137.10, with a market cap of Rs. 64,737 crore.
Brokerage Views
1. Vishal Mega Mart
- Target Price: Rs. 165 (Upside of 20.3%)
Rationale: Motilal Oswal has initiated coverage on Vishal Mega Mart Ltd. (VMM) with a ‘Buy’ rating and a target price of Rs 165, valuing it at around 45x Sep’27 expected EV/EBITDA based on DCF methodology. The brokerage sees VMM as a unique Indian value retailer with a strong presence in Tier 2 cities and beyond, operating 696 stores across 458 cities in 30 states and Union Territories. Its revenue mix is well-diversified, with 44% from apparel and around 28% from general merchandise and FMCG. About 72% of its stores are in less-penetrated regions, giving it a wide reach.
The company’s private-label strategy, which contributes 73% of total revenue, helps maintain affordability and drives profitability. Products in the FMCG segment are sourced from well-known vendors and priced below branded competitors, giving it a strong edge. Motilal Oswal expects EBITDA and revenue CAGR of 20% and 19%, respectively, supported by 13% CAGR in store expansion, steady same-store growth, and operating leverage. With one of the lowest cost structures (Rs 1,800/sq ft), a debt-free balance sheet, and efficient cash generation, the brokerage projects 24% PAT CAGR and strong free cash flow of Rs 23 billion over FY25–28.
Also read: Bulk Deal: Smallcap stock jumps 7% after Mutual Funds bought 1.1% stake in the company
2. Aditya Birla Lifestyle Brands
- Target Price: Rs. 170 (Upside of 9.5%)
Rationale: Bernstein has initiated coverage on Aditya Birla Lifestyle Brands Ltd. The company, which recently got demerged from Aditya Birla Fashion and Retail and listed on June 23, owns well-known legacy brands like Louis Philippe, Van Heusen, Allen Solly, and Peter England. These brands have shaped the formalwear market in India over the past two decades. It also has a growing portfolio of emerging brands such as Reebok, American Eagle, and Van Heusen Innerwear. However, Bernstein believes growth may be limited due to high market penetration, a shift toward casual clothing, and intense competition.
The brokerage pointed out that lifestyle brands have underperformed in the last decade, growing at less than 6% CAGR, slower than India’s GDP. It expects the company to grow at around 9.5% annually over the next five years, with EBITDA margins near 10%. While categories like athleisure, sportswear, and innerwear show better growth potential, ABLBL’s newer brands are still establishing themselves. Bernstein noted that unless the company manages consistent double-digit growth, profitability and scale challenges could keep stock performance muted. However, strong execution could lead to a re-rating.
About the companies
Aditya Birla Lifestyle Brands Ltd. (ABLBL), established in 2025, is part of the Aditya Birla Group and focuses on premium western wear. With a vast retail footprint across India, the company manages 4.7 million sq. ft. of retail space, operating over 3,300 exclusive brand stores. In addition, ABLBL has a presence in more than 37,000 multi-brand outlets and over 7,000 shop-in-shops within departmental stores, making it a major player in the fashion retail sector.
Vishal Mega Mart, founded in 2001, is a well-known hypermarket chain that serves a wide customer base, particularly the middle- and lower-middle-income segments. The company offers a variety of products, including clothing, groceries, electronics, and home essentials. It operates 645 stores in 414 cities across India and also runs an e-commerce platform. Its hub-and-spoke distribution model helps streamline operations and maintain efficiency across its large network.
Written By Fazal Ul Vahab C H
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