India's Arvind Fashions posts higher Q2 profit on demand for premium brands

Shoppers Stop

28/10/2024 11:14

Oct 28 (Reuters) - Indian retailer Arvind Fashions  ARVF.NS  reported a 36.6% rise in second-quarter profit on
Monday, aided by sustained demand for its premium clothing brands.
    The company, which retails clothing from international brands such as Arrow, Calvin Klein and Tommy Hilfiger, said its
profit after tax rose to 300 million rupees ($3.6 million) for the quarter ended Sept. 30 from 220 million rupees a year
ago. 
    Its revenue from operations grew 8.5% to 12.73 billion rupees. 
       
    KEY CONTEXT 

    Indian retailers have been grappling with subdued demand due to intensifying competition and moderating discretionary
spending as inflation accelerated in the quarter. 
    However, demand for premium products aimed at higher income consumers boosted the sales of companies, including Arvind
Fashions. 
    Peer Shoppers Stop  SHOP.NS  reported a loss in the second quarter as weaker discretionary spending weighed on the
company's bottomline. 
    
    
    PEER COMPARISON 
    
                                      Valuation (next 12     Estimates (next 12    Analysts' sentiment              
                                      months)                months)                                                
                      RIC             PE     EV/EBITDA       Revenue     Profit    Mean     No. of   Stock to       Div
                                                             growth      growth    rating*  analyst  price          yield
                                                                                            s        target**       (%)
 Arvind Fashions       ARVF.NS        44.24  12.30           12.83       59.13     Strong   5        0.91           0.23
                                                                                   Buy                              
 Shoppers Stop         SHOP.NS        81.89  14.04           15.03       19.21     Hold     6        0.84           NULL
 Trent                 TREN.NS        120.3  76.61           39.21       48.05     Buy      12       1.23           0.04
                                      1                                                                             
 Aditya Birla          ADIA.NS        NULL   19.61           15.20       NULL      Sell     18       1.02           NULL
 Fashion and Retail                                                                                                 
 
    
    * Mean of analysts' ratings standardised to a scale of Strong Buy, Buy, Hold, Sell, and Strong Sell
    ** Ratio of the stock's last close to analysts' mean price target; a ratio above 1 means the stock is trading above the
PT
    
    JULY-SEPTEMBER STOCK PERFORMANCE 
    

-- All data from LSEG
-- $1 = 84.0510 Indian rupees

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 (Reporting by Manvi Pant in Bengaluru; Editing by Janane Venkatraman)
 ((Manvi.Pant@thomsonreuters.com; +918447554364;))