Shares of Vishal Mega Mart will be in focus today, June 23 after Investec initiated 'buy' coverage on the stock, citing strong metrics and execution engine.
The brokerage, in its recent note, set a target price of Rs 144 on Vishal Mega Mart shares, marking an upside of 21.1% from its closing price.
On Monday, June 22, Vishal Mega Mart shares closed 0.20% higher at Rs 118.90a piece, while the benchmark Nifty 50 index ended 0.37% up.
Investec said Vishal Mega Mart with its scale of 795 stores, over 74% private-label mix, sharp sourcing and pricing is structurally best positioned to do better than competitors. The brokerage forecasts "a double-engine growth story" with 10% same store sales growth and 13% store additions. This is expected to drive 18% revenue and 21% EPS CAGR over FY26-29, notably under a tight cost structure.
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The company sees an opportunity from the formalisation of value retail as a standout structural consumption opportunity in India, underpinned by aspirational middle and lower-middle income consumers and accelerating adoption of branded products in tier-2/3 cities and beyond.
Along with diversified category mix, expanding footprint, high private-label skew, sharp design and sourcing capabilities, control on product quality and pricing, Vishal Mega Mart's strong and experienced management team will help to post a long growth runway, Investec said.
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