Despite posting robust Q1 numbers, Relaxo Footwear’s shares experienced a 1.50 percent drop in early trade on July 25. At 9:24 am, the stock was trading 1.38 percent lower at Rs 932 on the NSE.
During the first quarter ended June 30, 2023, Relaxo Footwears Ltd reported a substantial 54.5 percent year-on-year increase in net profit, reaching Rs 56.3 crore compared to Rs 39 crore in the previous year. Additionally, total revenue surged by 10.7 percent to Rs 738.8 crore from Rs 667.2 crore, driven by strong recovery in volumes for open footwear. The company’s EBITDA also witnessed notable growth, rising by 24.8 percent to Rs 107.6 crore, leading to an EBITDA margin of 14.6 percent, up from 12.9 percent in the previous fiscal.
Relaxo MD Ramesh Kumar Dua attributed the improved operating efficiency and profitability to the decline in raw material prices and the team’s efforts in navigating challenging market conditions. The company’s effective business strategies and well-received brands like Sparx, Bahamas, and Flite contributed to its robust position in the market, with all channels showing encouraging progress.
Brokerage firm Sharekhan expressed a bullish view on Relaxo Footwear, giving the stock a ‘buy’ rating and setting a target price of Rs 1,005 in its May 12 research report.
Over the last six months, Relaxo Footwear stock has delivered a return of 12.93 percent, outperforming the benchmark Nifty50 index, which yielded a return of 9.95 percent during the same period.
