Sharekhan has given Buy recommendation for Arvind with a target price of Rs. 145 in its research report issued on May 18, 2022
Sharekhan’s research report on Arvind
Arvind Limited (Arvind) registered yet another quarter of strong performance in Q4FY2022, with revenue growing by 33% to Rs. 2,203.5 crore and PAT increasing by 47% to Rs. 94 crore. Management has guided for 8-10% revenue growth in FY2023 with H1 performance expected to be subdued due to global uncertainties and higher inflation. Garment and AMD businesses to grow by 18-20%. Margins to remain under pressure due to higher cotton prices. Management is upbeat about medium-term outlook with large opportunities in the export market. Management is focusing on expanding capacities through de-bottlenecking mechanism. Debt reduced by Rs. 258 crore in FY2022 and is expected to further reduce going ahead.
Outlook
The stock trades at 8.8x/6.4x its FY2023E/FY2024E EPS. We maintain Buy with a revised PT of Rs. 145.