With a market capitalization of ₹ 5,792 crores, Safari Industries (India) is a small-cap company that manufactures and markets luggage and luggage accessories. It is a wholly-owned subsidiary of Safari Lifestyles Ltd and offers brands like Safari, MAGNUM, GENiUS and Genie.
According to the shareholding pattern of the company, ace investor Ashish Kacholia holds a 2.31% stake or 5,48,000 shares of the company. His holdings are worth ₹ 130.58 crores as its shares were trading at ₹ 2383.00 apiece at 03:00 PM on Tuesday.
In the past year, the company’s share price has risen from ₹ 955.05 apiece to ₹ 2383.00, giving multibagger returns of 149.52%. Therefore, if an investor had invested ₹ 1 lakh in the company’s shares a year ago, the value of their holdings would have been ₹ 249,520 today!
Brokerage firm Anand Rathi has a buy rating on the shares of Safari Industries with a target price of ₹ 2750. The time period given by the analyst is one year when the company can reach the target. The rationale behind the target is the fact that the company has reported high EBITDA margins in Q3FY22 and (9MFY23) and has witnessed continuous market share gains.
Safari Industries has a low return on equity of 7.71%, but an ideal debt-to-equity ratio of 0.45. Its shares were trading at a price-to-earnings ratio (P/E) of 64.08, which is very high compared to the industry P/E of 20.17, indicating that the stock might be overvalued as compared to its peers. The company’s promoters hold a 47.23% stake in it, followed by retail investors with 27.97%, foreign institutions with 15.93% and mutual funds with 8.87%.
Written by Simran Bafna
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