Emkay Global Financial's research report on Aditya Vision
AVL reported in-line EBITDA in Q4, although PAT was lower due to higher interest cost on slight delay in receipt of preferential proceeds. Q4/FY24 revenue grew 23%/32%, led by 6%/15% SSG. Slower Q4 SSG was due to extended winters. However, Q1TD trends remain encouraging and should help recoup some of the lost Q4 sales. Higher inventory of Rs4.3bn at Q4-end (up ~50%) also reflects the anticipation of a strong season, in our view. AVL exceeded its FY24 expansion outlook, with addition of 40 net stores, and plans to add another 30 in FY25 (on a base of 145 stores). Initial trends in eastern UP market are healthy and AVL plans to expand further toward central UP in FY25, followed by an entry into MP/Chattisgarh markets in FY26.
Outlook
We expect AVL to deliver ~30% Rev. CAGR over FY24-27E, led by under-penetration in the Hindi-heartland and better accessibility via AVL's network expansion/consumer financing. We maintain BUY with unchanged TP of Rs5,150/sh (39x FY26E EPS).
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Aditya Vision - 27052024 - emkay