'Buy' EPL Shares Maintains Systematix, Hikes Target Price Post Inline Q1 Results — Here's Why
EPL reiterated its double-digit growth guidance for topline and bottomline
FY26 started on a strong note for EPL, marked by consistent execution, robust margin expansion, and strong category-wise growth momentum. The company reiterated its full-year ambition of delivering double-digit revenue growth, anticipating Ebitda and PAT to surpass revenue growth.
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Systematix Report
EPL Ltd. posted healthy in line Q1 FY26 consolidated all-round performance. Revenue grew 10% YoY but was flat QoQ at Rs 11.07 billion (broadly in line), supported by strong performance across regions, except AMSEA. Gross margin expanded 68 bps YoY and 252 bps QoQ to 60.2% (estimate of 59.5%).
Ebitda jumped 16% YoY but was flat QoQ at Rs 2.2 billion (broadly in line). Ebitda margin of 20.1% (up 104 bps YoY but down 21 bps QoQ; estimated at 20.4%) was driven by product mix, operational discipline, and strong execution.
The beauty and cosmetics segment continued to deliver exceptional performance, recording over 35% YoY growth, led by strong traction in the EAP and Americas regions.
Management reiterated its double-digit growth guidance for topline and bottomline.
We have trimmed our FY26E/FY27E revenue/Ebitda by 1% each but raised PAT by 2% each, respectively, due to the lower tax rate.
Reiterating Buy with a revised target price of Rs 301 (Rs 296 earlier), based on 20x FY27E P/E (unchanged).
Key risks:
Subdued demand on global recession, higher commodity prices, freight and logistic issues
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