India's VIP Industries hits 2-1/2-yr low as Ambit downgrades to 'sell', prefers Safari

Safari Industries (INDIA)

15/03/2024 07:08

** Shares of luggage bags maker VIP Industries  VIPI.NS 
fall as much as 3% to 450.05 rupees, lowest level since Aug. 26,
2021
    ** Stock on track for an eighth consecutive session of loss,
if trend holds
    ** Brokerage Ambit downgrades VIPI to "sell" from "buy",
reduces PT to 440 rupees from 675 rupees
    ** VIPI lost market share from 54% in CY12 to 37% in CY23
due to increased competition, supply chain management issues -
Ambit
    ** Adds, VIPI's decision to drastically reduce dependence on
China in manufacturing backfired, leading to unavailability of
premium luggage
    ** VIPI's working capital levels have risen from ~20% in
FY18 to 26%/30% in FY23/1HFY24 due to higher inventory levels -
Ambit
    ** Prefers Safari Industries (India)  SAFA.NS  with "buy"
rating due to continued market share gains, better channel
execution

 (Reporting by Ashish Chandra in Bengaluru)
 ((ashish.chandra@thomsonreuters.com (+91 7982114624))