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ICICI Securities Report
Vedant Fashions Ltd.'s Q3 FY24 result was unexciting, impacted by ‘shraddh' in October 2023 (83% of ~18 shraddh days fell in October 2023 versus. 100% in September 2022). Same-store sales growth performance between October 15, and December 15 at 17% YoY should be analysed in the context of two times higher number of wedding days in Q3 FY24 (at 12 days versus six days in Q3 FY23); spillover benefit of 0 wedding days in Q2 FY24.
Hence, we would expect SSSG performance to be relatively higher. Key positives in the result include stable operating profit margins, healthy retail expansion rate, 85% cash conversion ratio, and continued expansion of flagship size (bigger size) Manyavar stores – these shall likely drive superior customer experience and operating leverage benefits.
Optimism now rests on Q4, which has ~30 wedding days (highest over last six years). Maintain 'Add'.
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