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Mayasheel Retail India Ltd. - Updated
Mayasheel Retail India Ltd. - Updated
Investment checklist
Mayasheel Retail India Limited
Management Trustworthy
Accounting practice Clean
Profitability ★★
Solvency ★★
Growth ★★★★
Valuation ★★★★★
Business position Emerging leader
Planify view ★★★★
Recommendation Buy
INVEST NOW
Snapshot:
ISIN: INE03O01017 CMP: INR 40
Total Income: INR 361 Cr Face value: INR 10
Profit after tax: INR (17.54) Cr Basic EPS: INR -7
EBITDA: INR 3.84 Cr D/E: 2.4
Dividend yield: NA Earnings yield: -7.82%
Total shares: 2,50,00,000 Market capital: INR 225 Cr
Enterprise value: INR 192 Cr Intrinsic Value: INR 82.5
Total equity: INR 2 Cr Reg date: 2014
Sector: Retail Sub-sector: Home Décor and
Clothing
About Company
Overview:
• Mayasheel Retail India Limited is an Indian Retail Company. in-
corporated in 2014, it is one of India’s up-and-coming retailer.
• Company have total revenue of Rs. 360 Cr. within 5 years of
existence which shows company is growing at a tremendous
rate.
• Kapil Karwa is the CEO of the venture.
• Its retail outlets offer Home Furnishing, Household goods and ap-
parels.
• Presently, company have more than 60 stores all over India with
total turnover of INR 360 Cr.
• Apart from 60 stores company is trying to organize Som bazar in
which company will be giving discounts on items every day in a
week for a particular period of time and 99 Stores where every
item will be of 99 rupees only and these activities are expected to
yield good revenue for company.
• Company was looking to move for IPO last year in FY21 but post-
poned the plans because of Pandemic.
• Share is currently available at a discount of 52% (Rs. 40 per
share) which makes it a preferable stock to invest in.
14%
86%
Industry overview:
Introduction:
• Indian apparel retail industry has emerged as one of the most
dynamic and fast-paced industries due to the entry of several
new players.
• The overall apparel segment size in FY 2020 was estimated to
be USD 67 bn.
Market size:
• Apparel Retail industry reached INR 4,89,498 crores in 2020.
• Apparel retail market is projected to grow at ~10 percent and
reach INR 7,81,735 by FY 2025.
Investment scenarios:
• India’s India’s retail sector attracted INR 7,275 crores from
various private equity funds in 2019.
• In September 2020, US private equity firm Silver Lake an-
nounced a plan to invest INR 7,500 crores in Reliance Retail,
which marks the second billion-dollar investment by Silver
Lake in a Reliance Industries subsidiary after the INR 1,01,25
crores investment in Jio Platforms earlier in 2020.
• Revenue of India’s offline retailers, also known as brick and
mortar (B&M) retailers, is expected to increase by INR
10,000-12,000 crore in FY20.
Indian Fashion Market (USD Bn)
120
107
100
80
67
60 55
41
40
20
0
FY2015 FY2018 FY2020E FY2025P
SWOT analysis:
Strengths:
Weakness:
• Company needs to look after the management of its working
capital, the current ratio (indicator of Short-term solvency) is
lower when compared to other listed peers.
Opportunities:
Rationale:
Return on equity %
0.0%
2019 2020 ROE% of the company has been sig-
-50.0% -26.8% nificantly decreased because of the
loss of INR 18 Cr. that has affected
-100.0%
the profitability of the company.
-150.0%
-161.2%
-200.0%
Rationale:
Return on capital employed %
0.0% ROCE% of the company has been sig-
2019 2020 nificantly decreased due to lower in-
-10.0%
-8.7% ventories in 2020 as compared to
-20.0%
2019. As a result, change in invento-
-30.0% ries have been increased and eventu-
-40.0% ally increment in expenses due to
-42.6%
which EBIT has fallen.
-50.0%
Rationale:
Return on assets %
0.0% ROA% of the company has been signifi-
2019 2020
-2.0% cantly decreased majorly because of de-
-4.0% -2.6% creased profits for the year or greater
loss earned during the year.
-6.0%
-8.0%
-10.0% -9.1%
Operating efficiency:
Rationale:
EBIT margin%
0.0%
EBIT margin% and EBITDA margin%
2019 2020
-1.0%
-1.2% of the company has been gradually
decreased because:
-2.0%
a) Revenue from operations of
-3.0% -3.4% the company has been in-
creased from INR 300 Cr.in
-4.0% 2019 to INR 360 Cr. in 2020,
on the contrary EBIT and
EBITDA of the company have
been decreased primarily be-
cause of higher change in in-
ventories and higher salary
EBITDA margin% and bonus expenditure (i.e.
4.0% employee benefit expenses)
2.9%
3.0%
2.0%
1.1%
1.0%
0.0%
2019 2020
-2.0%
-3.0%
-4.0% -4.9%
-5.0%
-6.0%
Profit before tax margin %
0.0%
2019 2020
-1.0%
-2.4%
-2.0%
-3.0%
-4.4%
-4.0%
-5.0%
Liquidity:
Rationale:
Current ratio
2.0
A marginal decrease in current and
1.5 quick ratio is primarily because of
0.9 0.9 lower closing inventories this year as
1.0 compared to 2019. This is majorly be-
0.5
cause of lower stock-in-trade ac-
quired for trading purposes from INR
0.0 134 Cr. in 2019 to INR 118 Cr. in
2019 2020 2020.
0.5
Quick ratio
0.4
0.3
0.2
0.1 0.1
0.1
0.0
2019 2020
Solvency:
Rationale:
Total debt/equity
2.5 2.4
There is a marginal decrease in
2.0 debt equity ratio primarily because
1.5 1.3 of the fact that company has low-
ered its loan from other than re-
1.0 lated parties from INR 1 Cr. in 2019
0.5 to nil in 2020.
0.0
2019 2020
Rationale:
Interest coverage ratio
0.0
2019 2020
A gradual decrease in interest cov-
-1.1 erage ratio is found majorly be-
-1.0
cause company’s opening stock of
-2.0
garments, clothes and other mer-
chandise is greater than its closing
-3.0 stock of garments, clothes and
-3.6
merchandise due to which EBIT of
-4.0 the company has fallen and subse-
quent decrease in interest cover-
age ratio.
Growth:
Rationale:
Total Income (in Cr.)
400.0 360.5 Total income of the company has
300.2 been significantly increased at a
300.0 growth rate of 20% primarily be-
cause of increased sales of gar-
200.0 ments, clothing and other mer-
chandise as compared to last year.
100.0
0.0
2019 2020
1 year: 20.0%
Rationale:
Profit after Taxes (in Lakhs)
0.0
Despite of greater revenue in 2020,
2019 2020
-5.0
company has suffered greater loss of
-5.3 INR 18 Cr. in 2020 which was loss of
-10.0 INR 5 Cr.in 2019. This is majorly be-
cause of lower closing inventories of
-15.0 garments, clothing and other mer-
chandise than opening inventories.
-20.0 -17.5
1 year: 231.9%
Rationale:
EPS
0.0 Due to greater loss this year, EPS of the
-1.0 2019 2020
company has been significantly re-
-2.0
-3.0 -2.1 duced from INR -2.1 in 2019 to INR -7
-4.0 in 2020.
-5.0
-6.0
-7.0
-8.0 -7.0
1 year: 230.5%
Rationale:
Total assets (Cr.)
250.0 Total assets have been decreased
210.4
200.0 174.3 from INR 210 Cr. in 2019 to INR 174
Cr. in 2020, primarily because com-
150.0
pany has lowered its furniture and fix-
100.0 tures which were INR 12 Cr. in 2019
50.0 and INR 9 Cr. in 2020.
0.0
2019 2020
1 year: -17%
Rationale:
EBITDA (in Cr.)
10.0 8.7 Company has increased its employee
8.0 benefit expenses due to which EBITDA of
6.0 the company has fallen from INR 9 Cr. in
3.8 2019 to INR 4 Cr. in 2020. Employee ben-
4.0
efit expenses of the company have been
2.0
primarily increased because of increased
0.0 salary and bonus expenditure which were
2019 2020
INR 2 Cr. in 2019 and INR 3 Cr. in 2020.
1 year: -56.3%
-5.00 -3.66
-10.00
-12.37
-15.00
1 year: 239.4%
Valuation:
Rationale:
ROE%
20.0% 3.2%
0.0%
-20.0% 2020
-40.0%
-60.0% -38.0%
-46.7%
-80.0%
-100.0%
-120.0%
-140.0%
-160.0%
-180.0% -161.2%
ROCE%
20.0%
7.6%
10.0%
0.0%
2020
-10.0%
-10.0% -10.1%
-20.0%
-30.0%
-40.0%
-50.0% -42.6%
4.0%
1.5%
2.0%
0.0%
-2.0% 2020
-4.0%
-6.0%
-8.0%
-10.0% -8.1%
-9.1%
-12.0% -11.0%
D/E Ratio
2.5 2.4
2.1
2.0
1.5
1.5
1.0
0.5
0.5
0.0
2020
Lorenzini Apparels Ltd. Thomas Scott(India) ltd.
3.0 2.3
2.0
1.0
0.0
2020
-1.0
-0.6
-2.0 -1.4
-3.0
-4.0 -3.6
2.0 1.9
1.8
1.6 1.5
1.4 1.2
1.2
0.9
1.0
0.8
0.6
0.4
0.2
0.0
2020
Lorenzini Apparels Ltd. Thomas Scott(India) ltd.
Current Ratio
2.5
2.0
2.0
1.5
1.1
1.0
1.0 0.9
0.5
0.0
2020
Lorenzini Apparels Ltd. Thomas Scott(India) ltd.
Quick Ratio
0.9 0.8
0.8 0.7
0.7
0.6
0.5
0.5
0.4
0.3
0.2
0.1
0.1
0.0
2020
Lorenzini Apparels Ltd. Thomas Scott(India) ltd.
300.0
243.7
250.0
200.0
150.0
100.0
50.0
2.5 3.8
0.0
-50.0 -7.9
EV/EBITDA
140.0 127.1
120.0
100.0
80.0 64.1
60.0
40.0 29.8
20.0
0.0
-20.0 2020
-9.9
(Figures in Cr.)
Current liabilities
Financial liabilities
Borrowings 0.00 13.00 4.67
Trade payables 139.84 144.31 142.16
Other financial liabilities 0.00 0.00 0.00
Other current liabilities 15.01 14.50 5.11
Provisions 0.00 2.28 0.48
Total current liabilities 154.85 174.10 152.43
Total liabilities 183.18 190.68 172.21
0.00%