Aditya Birla Fashion Q2 Review - Looking For Sustained Signs of Recovery; Maintain 'Hold': Axis Securities

Axis Securities Report

Aditya Birla Fashion and Retail Ltd.'s consolidated revenue stood at Rs 3,644 crore, up ~13% YoY (compared to our estimate of 15% YoY), driven by new businesses in emerging consumer segments. Ebitda was Rs 361 crore, up 11.8% YoY, with Ebitda margins at ~10%, a decline of 11 bps YoY due to higher other expenses, partially offset by 308 bps of gross margin expansion.

The company reported a negative PAT of Rs 215 crore due to higher depreciation/amortisation for brand and retail assets following the inclusion of TCNS Clothing Co. Ltd. and increased costs from elevated borrowings. However, management expects demand to revive from Q3 onwards, driven by the upcoming festive and wedding seasons.

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