RESULT UPDATE

ADITYA BIRLA FASHION AND RETAIL

Margins continue to shine
COMPANYNAME
India Equity Research| Retail

Aditya Birla Fashion and Retail (ABFRL) reported Q1FY19 revenue growth EDELWEISS 4D RATINGS
of 8.7% YoY in line with expectation while EBITDA and PAT topped our
Absolute Rating BUY
estimates. Lifestyle and Pantaloons reported SSSG of 1%/-2% owing to a Rating Relative to Sector Outperform
high base of 21%/14%. EBITDA margin continues to steal the show—it Risk Rating Relative to Sector Low
rose 174bps YoY on the back of a 330bps YoY jump in Pantaloons (in spite Sector Relative to Market Overweight
of rapid expansion) and a 64bps YoY increase at Madura. Innerwear and
new businesses too have begun to gain desired traction (innerwear
reached 8,600 touch points in a year). With ABFRL’s unwavering focus on MARKET DATA (R: ADIA BO, B: ABFRL IN)
prudent capital allocation, Madura scaling up further due to likely cuts in CMP : INR 154
Target Price : INR 187
discounting (proposed in draft e-commerce policy), Pantaloons’ ability to
52-week range (INR) : 184 / 132
generate free cash flow, revamp of Forever21 and ramp-up of innerwear
Share in issue (mn) : 771.7
and other new businesses, we retain ‘BUY’. M cap (INR bn/USD mn) : 119 / 1,741
Avg. Daily Vol.BSE/NSE(‘000) : 730.1
Revenue traction strong; margin expansion steals the show
For the third quarter in a row, ABFRL’s lifestyle segment reported revenue growth SHARE HOLDING PATTERN (%)
north of 5% YoY. This is attributable to 82.1% YoY growth in innerwear and other Current Q4FY18 Q3FY18
businesses – ABFRL’s innerwear touch points crossed 8,600 from 6,700 in Q4FY18. Promoters * 59.2 59.2 59.2
Though Fast Fashion’s revenue fell 27% YoY, we believe it is largely due to store MF's, FI's & BK’s 16.1 16.1 14.2
rationalisation and the focus on achieving profitability, e.g. EBITDA drag down to 6.8% FII's 10.5 10.5 11.6
from 12.4% in the base quarter. Pantaloons reported revenue growth of 11.2% YoY in Others 14.1 14.1 14.9
spite of a 2% decline in SSSG. Pantaloons’ EBITDA margin of 9.6% is a multi-quarter * Promoters pledged shares : NIL
high, an outcome of better gross margins, cost efficiencies and operating leverage. (% of share in issue)

PRICE PERFORMANCE (%)

Q1FY19 conference call: Key takeaways
EW Retail
Though an enabling resolution of raising INR10bn was taken, management is confident Stock Nifty
Index
of not raising capital since it believes that the requirement would be funded through
1 month (6.8) 2.3 (4.6)
internal accruals. Net store addition would be 300 in Lifestyle and 40–50 in Pantaloons.
3 months (8.4) 3.7 (10.6)
At end-Q1FY19, cash and debt were at INR750mn and INR20bn, respectively.
12 months (25.2) 10.7 (1.1)

Outlook and valuations: Primed for growth; maintain ‘BUY’

ABFRL stock, down 15% in one year, has been an underperformer in spite of its cheap
valuation of FY20E EV/EBITDA of 13.4x, not to mention the sustained recovery in both
revenue growth and margin profile over the past three quarters and high-profile
external recruitments. We maintain FY20E EV/EBITDA of 16x that yields our TP of
INR187. Maintain ‘BUY/SO’.
Financials (INR mn)
Year to March Q1FY19 Q1FY18 % change Q4FY18 % change FY18 FY19E FY20E Abneesh Roy
Net rev. 19,135 17,600 8.7 17,536 9.1 71,721 82,171 93,281 +91 22 6620 3141
abneesh.roy@edelweissfin.com
EBITDA 1,138 740 53.8 1,633 (30.3) 4,683 7,560 9,701
Adjusted Profit 56 (200) NM 443 NM 1,178 2,930 4,665 Alok Shah
Dilu. EPS (INR) 0.1 (0.3) NM 0.6 NM 1.5 3.8 6.1 +91 22 6620 3040
alok.shah@edelweissfin.com
Dilu.P/E (x) 100.8 40.5 25.4
EV/EBITDA (x) 29.5 18.1 13.4
ROAE (%) 11.5 23.6 28.8 August 1, 2018
Edelweiss Research is also available on www.edelresearch.com,
Bloomberg EDEL <GO>, Thomson First Call, Reuters and Factset. Edelweiss Securities Limited
 Retail
Table 1: Trends at a glance
Q3FY17 Q4FY17 Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19
Madura
Revenues (INRmn) 10,550 10,450 10,500 11,190 11,380 11,610 11,040
- Lifestyle brands 9,090 9,090 8,910 9,770 9,830 10,150 9,450
- Fast Fashion 1,150 1,020 1,200 970 990 810 880
- Other businesses 310 340 390 450 560 650 710
EBITDA (INR mn) 610 1,170 370 1,020 840 1,490 460
- Lifestyle brands 870 1,420 640 1,300 1,150 1,660 770
- Fast Fashion (160) (190) (140) (120) (230) (50) (60)
- Other businesses (100) (60) (130) (160) (80) (120) (250)
EBITDA margin (%) 5.8 11.2 3.5 9.1 7.4 12.8 4.2
- Lifestyle brands 9.6 15.6 7.2 13.3 11.7 16.4 8.1
- Fast Fashion (13.9) (18.6) (11.7) (12.4) (23.2) (6.2) (6.8)
- Other businesses (32.3) (17.6) (33.3) (35.6) (14.3) (18.5) (35.2)
EBIT (INRmn) 372 864 140 430 490 1,063 137
Key metrics
EBO's (Nos.) 1,895 1,878 1,862 1,893 1,906 1,818 1,818
SSG (%) (7.0) 0.2 21.0 (2.0) 4.0 7.7 1.0
Pantaloons
Revenues (INRmn) 6,666 5,857 7,310 7,400 7,500 6,410 8,130
EBITDA (INR mn) 360 140 460 350 650 270 780
EBIT (INRmn) (59) (218) 100 10 290 (177) 387
EBITDA margin (%) 5.4 2.4 6.3 4.7 8.7 4.2 9.6
EBIT margin (%) (0.9) (3.7) 1.4 0.1 3.9 (2.8) 4.8
SSG (%) (1.8) (5.0) 14.0 (11.0) 0.1 (6.0) (2.0)
Source: Company, Edelweiss research

Q1FY19 concall: Key takeaways

Overall demand scenario
 Lifestyle brands will continue to grow on the back of innovative product lines and
brand-strengthening initiatives.

 Pantaloons, with its focus on new store additions and improved price value equation,
will continue to grow profitably.

 The company will continue to build its portfolio in casualwear while women’s fast
fashion and super premium segments would complement the existing strong portfolio.

 Performance across e-commerce (65% YoY growth) has been encouraging – consistent
upward sales trajectory seen in the channel for most businesses.

 Focus on brand strengthening and rejuvenation; powerful marketing campaigns

significantly impacted consumers; and marketing spend increased by 40% YoY.

 If discounts narrow in e-commerce, it would be good for brand owners.

 Overall ad spend shot up 40%.

Lifestyle brands

 Difficult quarter for menswear. SSSG inched up 1% YoY. July again has been strong.

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 Aditya Birla Fashion and Retail Ltd

 Robust growth in the e-commerce business. Department stores sales grew by 18% YoY
despite a subdued market.
 Retail sales growth almost touched double-digit in FY18. Significant expansion of retail
outlets is likely this year.

 Retail on consignment basis is classified as retail, whereas what has been sold as
bought-out is classified as wholesale.

 Store addition would be ~350 stores; net addition would be ~300.

 E-commerce, which grew 50–60% YoY, makes up a high single-digit of the overall
business..

Pantaloons
 Increased advertising spend to counter the surge in competitive intensity.

 SSSG would be -2% YoY. SSSG volume is 3%; thus price cuts are ~5%.

 Profitability of new stores is close to profitability of old stores.

 Intent to accelerate store expansion pace.
 Will focus on improving the share of private labels. Focusing on improving in store
experience.
 Will also start the online journey.
 Margins have expanded on the back of store space rationalization, rent re-negotiations
and overall cost rationalization.
 Gross margin expansion largely driven by product-mix change.

 49 stores under the franchisee model; a maximum of 20% of stores would be under the
franchisee route.
 On average, breakeven happens in the first month itself.

 Overall stores in SSSG would be 180–190.

 Expansion would be 40–50 stores.

 Opening a new store generally entails INR1800 capex per sq ft for a 7,000 sq ft store
size; inventory would be INR120–150 days.

 No major margin difference on selling womenswear or kidswear.

Fast Fashion & Others

 Forever 21 (F21) – Store rationalisation underway; cautious growth with focus on

profitability; and large-format stores proving to be a viable model for expansion.
Management plans to add 4–5 FY21 stores this year.

 Innerwear – Distribution reach of ~8,600 outlets across 85 cities; significant branding

investments during the quarter; aggressive promotions to propel expansion; losses
should peak out this year; annual loss run rate should be similar to FY18’s; there are
more than 100 distributors without any overlap. INR5bn is the first target.
 International brands – First American Eagle store launched in the NCR; The Collective
continues to deliver robust performance.

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Retail
Way forward

 Focus on lifestyle brands with the objective of accelerating growth riding on newer
consumer segments, innovative product lines and brand-strengthening initiatives.

 In Pantaloons –aggressive expansion with enhanced profitability; focus on improving

product proposition; continued cost optimization with sharpening brand definition and
new store identity.

 Fast fashion and other businesses – Management plans to rapidly scale up the
innerwear business; steady build-up of international brands.

 Management is confident of not raising funds though an enabling resolution has been
taken.
 Large part of royalty is paid towards F21 and American Eagle. Some products sold in
Pantaloons also entail a royalty payment.

 FY19 capex would be INR3bn.

 At end-Q1FY19, net cash and debt at INR750mn and INR20bn, respectively.

Outlook and valuations: Primed for growth; maintain ‘BUY’

ABFRL is the No.1 player in menswear on account of Madura; it is No. 1 in womenswear too
driven by Pantaloons. We believe the company is better placed to exploit the recovery in
discretionary spending than other branded apparel players owing to its sheer scale and
widespread network.

Madura’s growth and margins – which were impacted by heightened competition from e-
commerce players, higher ad spends and lower operating leverage – have bounced back
strongly. We envisage a gradual recovery driven by the renewed focus on new and fast-
growing segments and improvement in throughput per outlet. Entry in the online segment
and the focus on becoming the largest brand therein are also bound to boost long-term
growth. Hence, Madura’s growth trajectory should sustain in our view.

Pantaloons, which is a turnaround story, has panned out as anticipated. Revenue pickup and
strong margin expansion has led Pantaloons to generate free cash flow, which is
encouraging. This coupled with the focus on strong store expansion should help tap the
pickup in discretionary spends. We expect the company to post decent SSSG led by a new
business model with focus on right pricing, fashion and private label mix. The company’s
initiatives like increasing the proportion of private labels, enhancing inventory turns and
reducing the sale season period should drive a sustainable improvement in margin.

Anchored by anticipated revival in organised retail formats, as well as prudent store

expansion and cost rationsalisation drive, we are confident of resumption of robust revenue
and margin trajectory. We maintain 16x FY20E EV/EBITDA and arrive at TP of INR187. At
CMP, the stock is trading at 13.4x FY20E EV/EBITDA. We maintain ‘BUY/SO’.

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 Aditya Birla Fashion and Retail Ltd

Financial snapshot (INR mn)

Year to March Q1FY19 Q1FY18 % change Q4FY18 % change FY18 FY19E FY20E
Net revenues 19,135 17,600 8.7 17,536 9.1 71,721 82,171 93,281
Raw material costs 9,212 8,330 10.6 8,258 11.6 33,901 37,634 42,163
Employee expenses 2,176 1,930 12.8 1,731 25.7 7,723 8,299 9,328
Lease charges 2,653 2,850 (6.9) 2,536 4.6 10,429 11,750 13,246
Other expenses 3,956 3,750 5.5 3,379 17.1 14,985 16,927 18,843
Total expenditure 17,997 16,860 6.7 15,903 13.2 67,038 74,611 83,580
EBITDA 1,138 740 53.8 1,633 (30.3) 4,683 7,560 9,701
Depreciation 723 590 22.5 870 (16.9) 2,805 2,697 2,819
EBIT 415 150 176.9 762 (45.5) 1,878 4,862 6,882
Interest 444 430 3.3 427 4.1 1,716 1,650 1,550
Other income 85 80 5.9 108 (21.3) 328 450 500
Profit before tax 56 (200) (128.0) 443 (87.4) 490 3,662 5,832
Provision for taxes - - - (688) 732 1,166
Associate profit share
Profit- Discontinued Ops (688) (100.0)
Reported net profit 56 (200) (128.0) 1,131 (95.0) 1,178 2,930 4,665
Adjusted Profit 56 (200) (128.0) 443 (87.4) 1,178 2,930 4,665
Diluted shares (mn) 769 769 769 769 769 769
Adjusted Diluted EPS 0.1 (0.3) (128.0) 0.6 (87.4) 1.5 3.8 6.1
COGS 48.1 47.3 47.1 47.3 45.8 45.2
Employee cost 11.4 11.0 9.9 10.8 10.1 10.0
Lease charges 13.9 16.2 14.5 14.5 14.3 14.2
Other expenses 20.7 21.3 19.3 20.9 20.6 20.2
EBITDA 5.9 4.2 9.3 6.5 9.2 10.4
EBIT 2.2 0.9 4.3 2.6 5.9 7.4
PBT 0.3 (1.1) 2.5 0.7 4.5 6.3
Adjusted net profit 0.3 (1.1) 2.5 1.6 3.6 5.0

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Company Description
In May 2015, ABFRL came into being following consolidation of ABNL's branded apparel
business of Madura and Pantaloons. Post consolidation, Pantaloons was renamed Aditya
Birla Fashion and Retail (ABFRL).ABFRL brings with it learnings and businesses of 2
renowned Indian fashion icons/brands, Madura and Pantaloons. This amalgamation has
helped ABFRL emerge as India’s No. 1 fashion lifestyle entity.

Madura has a vast retail network comprising exclusive outlets, premium multi-brand and
department stores – total presence of >1,800 stores. Four of its brands are among India's
top fashion names, with MRP sales in excess of INR10bn each. Pantaloons brand is now
present in 78 plus Indian cities/towns through 282 stores. Forever21 is a fashion retailer of
women’s, men’s and kids clothing and accessories and is known for offering the hottest,
most current fashion trends at great value to consumers. It innerwear business has achieved
strong distribution reach in its first year of operation itself.

Investment Theme
Aditya Birla Fashion and Retail (ABFRL) is one of the largest branded clothing players with 5
brands clocking >INR10bn sales each. ABFRL has now ventured into fast fashion via Forever
21and innerwear under the Van Heusenbrand thereby now housing full bouquet of
segments in the apparel category. Anchored by these potent growth boosters, we estimate
ABFRL to post sales and EBITDA CAGR of 14% and 43.9%, respectively, over FY18-20 and
28.8% RoE by FY20.

Key Risks
Slow GDP revival leading to lower traction in discretionary spending

While foreign brands such as Zara, Tommy Hilfiger, etc., have already established
themselves, other brands such as H&M, GAP, among others, are venturing inthe Indian
market thereby heightening competition.

Implementation of GST with anticipated tax neutral rate of 18%could lead to higher tax
outgo of 5-7% for branded apparel players.

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 Aditya Birla Fashion and Retail Ltd

Financial Statements
Key Assumptions Income statement (INR mn)
Year to March FY17 FY18 FY19E FY20E Year to March FY17 FY18 FY19E FY20E
Macro Net revenue 66,029 71,721 82,171 93,281
GDP(Y-o-Y %) 6.6 6.5 7.1 7.6 Materials costs 30,087 33,901 37,634 42,163
Inflation (Avg) 4.5 3.8 4.5 5.0 Gross profit 35,942 37,820 44,537 51,118
Repo rate (exit rate) 6.3 6.0 6.0 6.5 Employee costs 7,058 7,723 8,299 9,328
USD/INR (Avg) 67.1 64.5 65.0 66.0 Rent and lease expenses 10,871 10,429 11,750 13,246
Company Other Expenses 13,638 14,985 16,927 18,843
Revenue growth Pantaloon 18.3 12.1 20.6 18.8 EBITDA 4,375 4,683 7,560 9,701
Revenue growth Madura 3.4 8.6 9.8 9.6 Depreciation 2,425 2,805 2,697 2,819
SSSG growth - Pantaloon (%) 3.3 (2.6) 7.5 8.0 EBIT 1,951 1,878 4,862 6,882
SSSG growth EBOs - Madura (%) (6.7) 9.2 7.5 7.5 Less: Interest Expense 1,797 1,716 1,650 1,550
Net Store addition - Pantaloon 46.0 58.0 48.0 48.0 Add: Other income 381.5 328.1 450.00 500.00
Net Store addition - Madura 5.0 (65.0) 75.0 75.0 Profit Before Tax 536 490 3,662 5,832
Forever 21 (revenue growth %) 31.7 15.4 12.8 11.5 Less: Provision for Tax - (688) 732 1,166
Pantaloons - EBITDA as % of sales 4.9 4.0 6.0 7.3 Reported Profit 536 1,178 2,930 4,665
Madura - EBITDA as % of sales 8.5 11.5 14.1 15.3 Adjusted Profit 536 1,178 2,930 4,665
Tax rate (%) - (140.6) 20.0 20.0 Shares o /s (mn) 769 769 769 769
Capex (INR mn) 3,031 2,426 2,826 1,679 Diluted shares o/s (mn) 769 769 769 769
Debtor days 21 26 26 26 Adjusted Diluted EPS 0.7 1.5 3.8 6.1
Inventory days 172 168 168 168
Payable days 181 192 192 192 Common size metrics
Cash conversion cycle 13 2 2 2 Year to March FY17 FY18 FY19E FY20E
Dep. (% gross block) 28.2 26.0 23.0 23.0 Rent and lease expenses 16.5 14.5 14.3 14.2
Materials costs 45.6 47.3 45.8 45.2
EBITDA margins 6.6 6.5 9.2 10.4
Net Profit margins 0.8 1.6 3.6 5.0

Growth ratios (%)

Year to March FY17 FY18 FY19E FY20E
Revenues 9.4 8.6 14.6 13.5
EBITDA 15.6 7.0 61.4 28.3
Adjusted Profit - 119.9 148.8 59.2
EPS - 119.9 148.8 59.2

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Balance sheet (INR mn) Profitability and efficiency ratios

As on 31st March FY17 FY18 FY19E FY20E Year to March FY17 FY18 FY19E FY20E
Share capital 7,733 7,717 7,728 7,728 ROAE (%) 5.7 11.5 23.6 28.8
Reserves & Surplus 1,849 3,214 6,144 10,810 ROACE (%) 7.7 7.0 16.0 20.8
Shareholders' funds 9,582 10,931 13,872 18,538 Inventory Days 172 168 168 168
Total Borrowings 22,213 20,208 21,500 17,000 Debtors Days 21 26 26 26
Long Term Liabilities 756 2,084 2,084 2,084 Payable Days 181 192 192 192
Sources of funds 32,551 32,535 36,767 36,933 Cash Conversion Cycle 13 2 2 2
Gross Block 7,916 9,142 10,768 11,247 Current Ratio 1.3 1.3 1.5 1.4
Net Block 6,275 7,227 4,223 2,115 Gross Debt/EBITDA 5.1 4.3 2.8 1.8
Capital work in progress 250 459 250 250 Gross Debt/Equity 2.3 1.8 1.5 0.9
Intangible Assets 18,596 18,596 21,379 22,346 Adjusted Debt/Equity 2.3 1.8 1.5 0.9
Total Fixed Assets 25,121 26,282 25,852 24,712 Interest Coverage Ratio 1.1 1.1 2.9 4.4
Non current investments 2,184 42 42 42
Cash and Equivalents 676 728 3,378 5,671 Operating ratios
Inventories 14,313 16,912 17,751 21,083 Year to March FY17 FY18 FY19E FY20E
Sundry Debtors 4,539 5,518 6,004 7,076 Total Asset Turnover 2.1 2.2 2.4 2.5
Loans & Advances 2,565 4,562 4,562 4,562 Fixed Asset Turnover 2.7 2.8 3.2 3.7
Other Current Assets 962 2,606 2,632 2,658 Equity Turnover 7.1 7.0 6.6 5.8
Current Assets (ex cash) 22,378 29,598 30,949 35,380
Trade payable 15,511 20,093 19,432 24,849 Valuation parameters
Other Current Liab 2,297 4,022 4,022 4,022 Year to March FY17 FY18 FY19E FY20E
Total Current Liab 17,808 24,116 23,454 28,872 Adj. Diluted EPS (INR) 0.7 1.5 3.8 6.1
Net Curr Assets-ex cash 4,571 5,483 7,496 6,508 Y-o-Y growth (%) (148.8) 119.9 148.8 59.2
Uses of funds 32,551 32,535 36,767 36,933 Adjusted Cash EPS (INR) 3.9 5.2 7.3 9.7
BVPS (INR) 12.5 14.2 18.0 24.1 Diluted P/E (x) 221.6 100.8 40.5 25.4
P/B (x) 12.4 10.9 8.6 6.4
Free cash flow (INR mn) EV / Sales (x) 2.1 1.9 1.7 1.4
Year to March FY17 FY18 FY19E FY20E EV / EBITDA (x) 32.0 29.5 18.1 13.4
Reported Profit 536 1,178 2,930 4,665
Interest (Net of Tax) 1,797 1,716 1,320 1,240
Others (113) (328) (120) (190)
Less: Changes in WC 461 (731) 1,987 (1,014)
Operating cash flow 4,183 6,102 4,841 9,549
Less: Capex 3,031 2,426 2,826 1,679
Free Cash Flow 1,152 3,676 2,015 7,870

Peer comparison valuation

Market cap EV / EBITDA (X) EV / Sales (X) ROAE (%)
Name (USD mn) FY19E FY20E FY19E FY20E FY19E FY20E
Aditya Birla Fashion and Retail Ltd 1,741 18.1 13.4 1.7 1.4 23.6 28.8
Future Lifestyle Fashions Limited 1,204 15.8 12.9 1.6 1.4 12.1 15.4
Shoppers Stop 718 15.2 12.3 1.1 1.0 10.8 13.2
Titan Company 11,900 37.4 29.1 4.5 3.7 25.9 28.2
TRENT LTD 1,774 43.8 31.1 4.4 3.5 11.0 14.2
Wonderla Holidays 274 17.0 13.5 5.9 5.0 6.6 8.8
Median - 17.6 13.5 3.1 2.5 11.6 14.8
AVERAGE - 24.5 18.7 3.2 2.7 15.0 18.1
Source: Edelweiss research

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Additional Data
Directors Data
Mr. PranabBarua
Mr. ArunThiagarajan
Ms. Sukanya Kripalu
Auditors - M/s SRBC & Co. LLP
Top 10 holdings
Life Insurance Corp Of India
Franklin Templeton Asset Managemen
Uti Asset Management Co Ltd
Goldman Sachs Group Inc/The
Dimensional Fund Advisors Lp
Bulk Deals
Data
No Data Available
Insider Trades
Reporting Data
No Data Available
Aditya Birla Fashion and Retail Ltd
Managing Director Mr. Sushil Agarwal Non-Executive Director
Non Executive - Independent Director Mr. Bharat Patel Non Executive - Independent Director
Non Executive - Independent Director Mr. Sanjeeb Chaudhuri Non Executive - Independent Director
*as per last annual report
Perc. Holding Perc. Holding
4.10 Reliance Capital Trustee Co Ltd 4.01
3.85 Birla Group Holdings Pvt Ltd 2.43
1.95 Mirae Asset Global Investments Co 1.26
1.10 Hsbc Global Inv Mauritius 1.08
1.02 Hsbc Holdings Plc 0.74
*as per last available data
Acquired / Seller B/S Qty Traded Price
*in last one year
Acquired / Seller B/S Qty Traded
*in last one year
9 Edelweiss Securities Limited
 RATING & INTERPRETATION

Company Absolute Relative Relative Company Absolute Relative Relative

reco reco risk reco reco Risk
Aditya Birla Fashion and Retail Ltd BUY SO L Avenue Supermarts Limited HOLD SU H
Future Lifestyle Fashions Limited BUY SO L Future Retail BUY SO H
Jubilant Foodworks BUY SP M Shoppers Stop BUY SO L
Titan Company BUY SO L TRENT LTD BUY SO H
V-MART Retail BUY SO H Wonderla Holidays BUY SP M

ABSOLUTE RATING
Ratings Expected absolute returns over 12 months

Buy More than 15%

Hold Between 15% and - 5%

Reduce Less than -5%

RELATIVE RETURNS RATING

Ratings Criteria
Sector Outperformer (SO) Stock return > 1.25 x Sector return

Sector Performer (SP) Stock return > 0.75 x Sector return

Stock return < 1.25 x Sector return

Sector Underperformer (SU) Stock return < 0.75 x Sector return

Sector return is market cap weighted average return for the coverage universe
within the sector

RELATIVE RISK RATING

Ratings Criteria

Low (L) Bottom 1/3rd percentile in the sector

Medium (M) Middle 1/3rd percentile in the sector

High (H) Top 1/3rd percentile in the sector

Risk ratings are based on Edelweiss risk model

SECTOR RATING
Ratings Criteria
Overweight (OW) Sector return > 1.25 x Nifty return

Equalweight (EW) Sector return > 0.75 x Nifty return

Sector return < 1.25 x Nifty return

Underweight (UW) Sector return < 0.75 x Nifty return

10 Edelweiss Securities Limited

 Aditya Birla Fashion and Retail Ltd

Edelweiss Securities Limited, Edelweiss House, off C.S.T. Road, Kalina, Mumbai – 400 098.
Board: (91-22) 4009 4400, Email: research@edelweissfin.com

ADITYA
Digitally signed by ADITYA NARAIN
DN: c=IN, o=EDELWEISS SECURITIES LIMITED,
Aditya Narain ou=HEAD RESEARCH, cn=ADITYA NARAIN,
serialNumber=e0576796072ad1a3266c27990
f20bf0213f69235fc3f1bcd0fa1c30092792c20,
Head of Research
NARAIN
postalCode=400005,
2.5.4.20=3dc92af943d52d778c99d69c48a8e0
c89e548e5001b4f8141cf423fd58c07b02,
aditya.narain@edelweissfin.com st=Maharashtra
Date: 2018.08.01 20:40:07 +05'30'

Coverage group(s) of stocks by primary analyst(s): Retail

Aditya Birla Fashion and Retail Ltd, Avenue Supermarts Limited, Future Lifestyle Fashions Limited, Future Retail, Jubilant Foodworks, Shoppers Stop,
TRENT LTD, Titan Company, V-MART Retail, Wonderla Holidays

Recent Research

Date Company Title Price (INR) Recos

31-Jul-18 Avenue Focus back on volumes; store 1595 Hold

Supermarts addition on radar;
(D’mart), Result Update
30-Jul-18 Shoppers Stop Profitability improves; SSSG to 550 Buy
revive soon;
Result Update
25-Jul-18 Jubilant Say cheese;; 1400 Buy
Foodworks Result Update

Distribution of Ratings / Market Cap

Edelweiss Research Coverage Universe Rating Interpretation

Buy Hold Reduce Total Rating Expected to

Rating Distribution* 161 67 11 240 Buy appreciate more than 15% over a 12-month period
* 1stocks under review
Hold appreciate up to 15% over a 12-month period
> 50bn Between 10bn and 50 bn < 10bn
743
Reduce depreciate more than 5% over a 12-month period
Market Cap (INR) 156 62 11
594

One year price chart

446
(INR)

200
297 180

149 160
(INR)

- 140
Apr-14

Sep-14
Feb-14

Mar-14

Jun-14

Dec-14
Jul-14

Aug-14

Oct-14

Nov-14
May-14
Jan-14

120

100
Dec-17
Oct-17
Aug-17

Apr-18

May-18
Nov-17

Jan-18
Sep-17

Feb-18

Jun-18
Mar-18
Jul-17

Jul-18

Aditya Birla Fashion and Retail

11 Edelweiss Securities Limited

 Retail

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