Page Industries stock tanked 3.6% in early trade to Rs 40,980.35 today on account of a subdued Q1 performance . However, it reversed its losses, closing 2.19% higher from Thursday’s closing price. From its intraday low of Rs 38,603.75, the share jumped 6.3% to touch a high of Rs 41,074.35 apiece. A higher competitive intensity and a general slowdown in demand led to a decline in the revenue of Page industries, 8% on-year and 28% on-quarter to Rs 12.4 billion. The company’s EBITDA also declined 19% on-year, whereas the EBITDA margins were down 270 bps on-year to 19.5%.
However, owing to cost control measures, margins have improved sequentially and are expected by the management to hover around 19-21%, led by a continued cost optimization program. Page Industries stock has surged nearly 14% in the last one month, and over 6% in the last six months. Analysts at ICICI Securities and Axis securities have recommended a ‘Hold’ rating on Page Industries stock with an expectation of a better H2FY24.
“ARS (software) implementation has been completed (sooner than expected) and shall augur well for effective distribution. Also, while the men’s premium innerwear segment is fastest growing, we believe slower growth in women’s innerwear and athleisure wear segments are more structural than temporary. We liked the positive bias of management in margin guidance (to 19-20%). Maintain HOLD.”
Axis Securities
Hold | Target Price: Rs 40,000
“Q1FY24 volume declined 11.5% YoY to 5.58 Cr pieces as 1) demand remains volatile and 2) competitive intensity increased in the form of promotions and discounts. The company highlighted that volume has improved in the last two weeks, while it expects demand to improve only from Q3, led by the festive season. We maintain our HOLD recommendation as we reduce our FY24/25 estimates based on near-term growth challenges. However, the increase in TP is on account of the incorporation of FY26 estimates and we value the company on Jun’25 EPS.”