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Target: ₹240
CMP: ₹201.15
Electronics Mart (EMIL) had a descent Q4 in the backdrop of good summer season. The company achieved a 15 per cent y-o-y revenue growth in Q4FY24 and FY24 while the SSSG stood at 7.3 per cent and 8.4 per cent in Q4FY24 and FY24. The EBITDA also demonstrated 18 per cent and 33 per cent growth with EBITDA margins improving to 7.1 per cent and 7.2 per cent in Q4FY24 and FY24 respectively.
The company also reported a 12/50 per cent y-o-y increase in PAT for Q4-FY24 and FY24 respectively.
EMIL focused on expanding its store network, adding 33 new MBOs and 1 new EBO in FY24, with a total of 160 stores. The company’s sales mix was dominated by large appliances and mobiles, and it faced initial challenges in new store productivity due to recent openings.
It clearly focuses on premium products and strong product depth with only top brands in various categories, retailing top brands rather than adding private labels to avoid discounting and inventory issues, simple and flat floor and corporate reporting structure, which enables cost controls, quick decision making and higher employee incentives.
Key risks: Intensified aggression by larger players like Croma, Reliance and Vijay Sales, muted demand conditions driving down trading or higher discounting and brand acceptance issues in the new Delhi/NCR market.
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