DOMS Industries - Product Differentiation Is Key To Success; ICICI Securities Initiates Coverage With Buy

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..ICICI Securities Report.DOMS Industries Ltd. has emerged as one of the strongest stationery and art products players in India with ~12% market share in FY23 from negligible share in FY10. Key reasons:Product differentiation. It has introduced multiple value-added products after identifying gaps in the product offerings of other players, strong investments in manufacturing and backward integration,strategic partnership with FILA, which has helped DOMS in accessing global products, markets and augment research and development capabilities, strong brand (Doms, C3) with a sub-segmentation strategy (Amariz, Fixy Fix) andestablished distribution network of more than 0.12 million outlets. .It also has the most diversified revenue stream versus peers (i.e. presence across all major sub-segments), indicating low product concentration risk. We expect DOMS to further strengthen its position by-entering into adjacent business/product categories, expansion of manufacturing capabilities, and higher exports. We model DOMS to report revenue/profit after tax compound annual growth rate of 24.4%/29% over FY24-26E. We note it has been steadily generating EVA over FY14-FY24E. We initiate coverage on the stock with Buy rating and discounted cash flow based target price of Rs 1,825 (implying 48 times FY26E earnings)..Key risks Higher dependence on key products like pencils and mathematical instrument boxes could increase product concentration risk. Any impact of businesses on these products may impact the company’s earnings estimates. The company is dependent on its global partner for exports. Any discontinuation of agreement between both the parties may impact the company’s earnings estimates.Any technological and innovation change in the industry that may not be well adopted by the company may impact its earnings estimates.  Steep increase in commodity prices and competitive pressures..Click on the attachment to read the full report:.Inox India - Tanked Up And Ready To Roll; ICICI Securities Initiates Coverage With A Buy.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit. .Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

DOMS Industries - Product Differentiation Is Key To Success; ICICI Securities Initiates Coverage With Buy

Sets DCF based target price of Rs 1,825 (implying 48 times FY26E earnings).

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