Shoppers Stop Q4 Review – Green Shoots Visible Post-Recovery From Omicron: Motilal Oswal

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Adjusted for the one-off, Shoppers Stop Ltd.’s Ebitda increased 13.8% YoY, below our estimate, as the company lost ~ 15-20% revenue led by Omicron in January-February 2022.

However, green shoots are visible as March 2022 saw 40% YoY growth and April is witnessing double-digit growth versus pre-Covid-19.

Shoppers Stop’s heightened pace of store additions and ramp up in private labels are likely to revive growth. We have raised our FY23E / 24E Ebitda by ~ 5% each, on expectation of better growth and modeled 28% revenue compound annual growth rate over FY 22- 24 backed by revenue recovery and higher store additions.

However, the longevity of growth is uncertain as the lifestyle apparel category has reported muted growth outlook.

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