Pantaloon Retail 33% Upside ENAM 2011 TOP Pick

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Pantaloon Retail  33% Upside ENAM 2011 TOP Pick 



Aggressive roll out plans /Financial Restructuring
● Aggressive rollout plans, ~ 2 mn sq ft p.a. (currently 12 mn sq ft) over next 3 years, along with
Same‐ store‐sales growth will drive revenue’s by ~22% p.a. over the next 2 years. Moreover operating
cash flows are sufficient to fund this expansion.

● Increased efficiency from better inventory management (reduce inventory/sq ft by~15%) will improve

the working capital cycle. Reduced debt through QIP proceeds, will ease interest burden and drive
earning’s by ~55% CAGR over the next 2 years. Financial restructuring (divesting Insurance arm) will
unlock value.
● Key triggers to watch out for would be: turnaround in the electronic biz, divestment of financial vertical
and improvement in capital efficiency. We maintain a Buy rating on the stock with a SOTP‐based Target
Price of Rs 485/‐