Affordable footwear maker Khadim India Ltd. expects its profit to grow 30-32 percent over the next few years, buoyed by its expansions plans, distribution business and overall move towards branded retail.
“In both the segments, be it retail or distribution, we plan to scale up our business on an asset-light model so there would be better impact on the profitability of the company and return ratios,” Ishani Ray, chief financial officer of Khadim India, told BloombergQuint.
The company also expects to benefit from the economies of scale, adding to the growth in its earning before interest, tax, depreciation and amortisation, and profits, she said. Axis Capital recently initiated a 'Buy'rating on the stock. “We see Khadim as a structural play on the fast growing value -for-money footwear market,” the note said.
Here's how the company expects its business to grow over the next few years:
- Retail business to grow at 13-14 percent
- Distribution business to grow at 26-27 percent, above industry estimates of 22-23 percent
- Ebitda to improve by 50 basis points
- Footwear retail business to grow at 14-15 percent in line with industry estimates
- Topline to grow around 15 percent
- Bottomline to grow 30-32 percent
Shares of Khadim India were trading 0.71 percent higher at Rs 790 at 11.13 am on the BSE. The stock price has risen 15.8 percent in 2018 so far, compared to a 5.9 percent in the benchmark S&P BSE Sensex Index.
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