The shares of this leading apparel manufacturer gained 2.5 percent to ₹35,475.65 per share on Monday after UBS assigned a buy call with an upside of 27 percent.
Page Industries Ltd. is engaged in the manufacturing, distribution, and marketing of innerwear, athleisure, sleepwear, and swimwear for men, women, and kids under the brand name Jockey.
The company’s operational revenue has increased by 2.5 percent year on year from ₹1,200 crores in Q3FY23 to ₹1,229 crores in Q3FY24, while net profit has increased by 23 percent from ₹124 crores to ₹152 crores.
Page Industries Ltd. shares have experienced a 14 percent decrease over the past six months and an 8 percent decrease over the last twelve months.
Page Industries and Brand Jockey have pioneered the innerwear industry on many fronts. The company has established the premium segment in the innerwear category in India through the brand Jockey.
The company sells its products under two brands Jockey and Speedo. Under the jockey brand, the product portfolio includes underwear, handkerchiefs, caps, towels, etc. The company has opened 211 exclusive brand outlets across India, taking the total number of EBOs to 1,131, including 48 ‘Jockey Woman’ EBOs and 71 Jockey Juniors EBOs.
UBS gave a buy call on branded underwear company, “Page Industries Ltd”. with a target price of ₹44,000 per share, representing an upside of 27 percent from Monday’s trading price of ₹34,665 per share.
According to the brokerage firm, Page Industries has a robust distribution network, with approximately 70% of production being handled in-house. Additionally, the company maintains a healthy back-end capacity and demonstrates effective working capital management. Furthermore, Page Industries is anticipated to experience growth, attributed to its solid balance sheet.
In its analysis, UBS noted that increasing demand will stimulate companies’ volume growth, while the company’s strong distribution channels and brand recognition will further propel its expansion.
UBS projects that the company is poised to achieve an annual income growth compound annual growth rate (CAGR) of 10.5% between 2023 and 2026. Additionally, during the same period, earnings before interest, taxes, depreciation, and Amortization (EBITDA) growth is anticipated to attain a CAGR of 16%. Furthermore, there is an expected increase in the company’s EBITDA margin by 231 basis points, reaching 21.1% by the end of the fiscal year 2026.
Written by Omkar Chitnis
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