Relaxo buy at 840 with SL=760

Relaxo, leading footwear company, would benefit from its plan to increase distribution incentives, shift in demand from unorganised sector and higher realisation rate

Relaxo Footwear (Relaxo) is engaged in manufacturing and trading of footwear primarily made up of vulcanized/ moulded rubber

Company’s major revenue consists of ~20%, ~35% and ~35% from Bahamas, Sparx and Flite respectively.

Relaxo has nine manufacturing plants across India with a capacity of  over 7,75,000 lakh pairs/day.

Company has ~300 exclusive brand outlets (EBOs, all owned by Relaxo) and more than 50,000 distributors. Its strategy to open franchisee stores (asset light) bodes well for PAT growth

GST rate cut to 5 % will boost the profit in coming months

 

relaxo

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