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Aditya Birla Fashion Q1 Review: Systematix Cuts Target Price Amid Margin Headwinds — Check Upside

While Pantaloons, TMRW and luxury businesses delivered double-digit growth in Q1, Systematix remains cautious on the pace of earnings recovery owing to margin pressure, input-cost inflation and continued investments in newer businesses.

Aditya Birla Fashion Q1 Review: Systematix Cuts Target Price Amid Margin Headwinds — Check Upside
Aditya Birla Fashion's revenue rose 10.6% YoY to Rs 2,026 crore in Q1 FY27, broadly in line with the brokerage's expectations.
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Aditya Birla Fashion and Retail Ltd.
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NDTV Profit's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer NDTV Profit's subscribers an opportunity to expand their understanding of companies, sectors and the economy.

Systematix Report

Aditya Birla Fashion and Retail Ltd. reported double-digit revenue growth in the June quarter, but profitability remained under pressure, prompting Systematix Research to maintain its 'Hold' rating and cut the target price to Rs 67 from Rs 73.

The brokerage believes earnings recovery could take longer than anticipated as investments in growth businesses and rising input costs continue to weigh on margins.

Aditya Birla Fashion's revenue rose 10.6% YoY to Rs 2,026 crore in Q1 FY27, broadly in line with the brokerage's expectations. However, operating performance lagged estimates as gross margin declined 74 basis points to 56.6% due to higher input costs.

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Ebitda fell 2% YoY to Rs 117 crore, while Ebitda margin contracted 32 basis points to 5.8%. The company reported a net loss of Rs 215 crore during the quarter, compared with a loss of Rs 212 crore a year ago.

Click on the attachment to read the full report:

Systematix Abfrl Q1.pdf
VIEW DOCUMENT

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