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Multi Baggers

Hem Securities

5.30 AM Jan 1st 1970

Vaibhav Global

BSE ID : 532156     NSE ID : VAIBHAVGBL

RECOMMENDED PRICE 675.00

PEAK FROM RECO 1057.70 56.70%

CURRENT PRICE 368.85 Resource id #18

Vaibhav Global Limited is an electronic retailer of discount fashion jewelry and lifestyle accessories in the US, Canada, UK and Republic of Ireland. We initiate a 'BUY' on the stock with a target price of Rs 1050 with medium to long term investment horizon.

Vaibhav Global Limited

Vaibhav Global Limited (VGL) incorporated in Jaipur, India in 1989, is a global retailer in fashion and lifestyle accessories on TV shopping and web platforms.

The company has robust numbers for the quarter ending March 2014. The Revenues from operations on consolidated basis increased by around 57 percent at Rs.363.89 crores vs Rs.231.26 crores y-o-y. Operating profit zoomed manifold at Rs.33.86 crores form Rs.4.57 crores y-o-y. Adjusted Net profit climbed about 51 percent at Rs. 36.76 crores from Rs. 24.41 crores (pre exceptional). EBIDTA margin expanded sharply by 733 bps at 9.31 percent from 1.98 percent y-o-y. EPS for the quarter stood at Rs.11.43.

Revenues from TV sales stood at Rs.242 crores in Q4FY14 from Rs.178 crores in Q4FY13; a jump of 36 percent. Revenues from Web sales almost doubled at Rs.66 crores in Q4FY14 from Rs.32 crores in Q4FY13. Business to business (B2B) sales climbed sharply at Rs.52 crores in Q4FY14 from Rs.17 crores in Q4FY13.

VGL has large customer base. It has reach to about 95 million households on full equivalent (FTE) basis. Out of which it caters to about 53 million household in the US, 25 million household in the UK and about 18 million households in Canada.

The company has Demonstrated profitable growth with direct-to-consumer business model on home shopping and e-commerce platforms with US and UK denominated revenue operations.

Valuation

With strong volumes building up; increasing market presence; strong customer base; improved financial performance and balanced product portfolio; Vaibhav Global Ltd. profitability looks positive. We believe the company is trading at an attractive valuation at 13.48x and 10.90x of FY15EPS of Rs 50.06 and FY16EPS of Rs 61.95. We initiate a 'BUY' on the stock with a target price of Rs.1050 (appreciation of about 56 percent) with medium to long term investment horizon.

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Disclaimer & Disclosure: This document is prepared for our clients only, on the basis of publicly available information and other sources believed to be reliable. Whilst we are not soliciting any action based on this information, all care has been taken to ensure that the facts are accurate, fair and reasonable. This information is not intended as an offer or solicitation for the purchase or sell of any financial instrument and at any point should not be considered as an investment advise. Reader is requested to rely on his own decision and may take independent professional advise before investing. Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited, Directors and any of its employees shall not be responsible for the content. The person accessing this information specifically agrees to exempt Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited or any of its affiliates or employees from, any and all responsibility/liability arising from such misuse and further agrees to hold Hem Securities Limited, Hem Finlease Private Limited, Hem Multi Commodities Pvt. Limited or any of its affiliates or employees free and harmless from all losses, costs, damages, expenses that may be suffered by the person accessing this information due to any errors and delays. The companies and its affiliates, officers, directors, and employees, including persons involved in the preparation or issuance of this material may from time to time, have long or short positions in, and buy or sell the securities there of, company (ies) mentioned here in and the same have acted upon or used the information prior to, or immediately following the publication. Analyst Certification The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the research analyst(s) was, is, or will be directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report.

Vaibhav Global_Multibagger_HemSec.pdf

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