On Monday, Elara Capital announced that it is recommending people to buy shares of Vishal Mega Mart, a big supermarket chain in India. They set a target price of Rs 140 per share, which means the stock could go up by more than 35% from its current price of Rs 103.05. Elara Capital praised Vishal Mega Mart for having a strong financial position, running efficiently, and having great growth opportunities in India’s growing retail market.
Vishal Mega Mart, which has stores across 30 states and union territories, has performed well since it started trading on December 18. The shares opened at Rs 110 on the stock market, giving investors a quick profit of 41%. By using its own smart strategies, the company has shown that it can compete well with other major retail brands like DMart and Trent.
Currently, Vishal Mega Mart operates 645 stores in 414 cities, and it plans to grow quickly. They are expected to open more stores and see better sales in existing locations, aiming for 846 stores by FY27. Elara predicts the company’s revenue will rise by 19.2% each year between FY24 and FY27, which is supported by better sales and cost-saving methods.
The company focuses on affordable products, especially clothing and general items, selling a big chunk (about 73%) of its own brand products. This helps them earn more profit. They mainly target middle and lower-income families, with a loyal customer base of around 133.8 million, which is expected to grow by 17% each year until FY27.
Elara’s target price of Rs 140 is based on expected earnings for FY27. However, they also warned that there could be risks, such as slower store openings or problems with supply chains as the company grows.
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