Westlife

Westlife Development share price: Buy Westlife Development, price target Rs 600: Phillip Capital (India)

Phillip Capital (India) has a buy call on . with a target price of Rs 600.0. The current market price of Westlife Development Ltd. is Rs 455.7.

Westlife Development Ltd., incorporated in 1982, is a mid-cap company (having a market capitalization of Rs 7118.05 Crore) operating in the tourism and hospitality sector.

The main products/revenue segments of Westlife Development Ltd. include income from the sale of stocks and securities for the year ending March 31, 2021.




finance

For the quarter ended 31-03-2022, the company reported a consolidated total revenue of Rs 468.18 Crore, down -2.68% from last quarter. Total revenue of Rs 481.10 Crore and up by 29.74% compared to the same quarter last year. Total income of Rs 360.87. Crore. The company reported a net profit after tax of Rs 15.32 Crore last quarter.

Investment rationale:
Relatively better placed compared to the competition; Hold the buy: With the economy gradually returning to normal, the brokerage reiterated its high-conviction thesis that the shift to a large, organized and trusted brand is here to stay and its amplifying effect will clearly be visible in FY23 once the Covid-19 headwinds recede.

Additionally, management’s new aggression to double the number of stores (means annual addition of 50 stores/year versus historical addition of 25-30 stores/year) over the past 3-5 coming years is likely to reassess the valuation multiple and make WLDL (Mcdfranchisee partner for West and South India) as the preferred game in the fast growing QSR segment (23% Cagr in FY20-25 ) given that it a) ability to drive high unique SSSg on a sustainable basis through NPD, personalization keeping customer needs front and center b) exponential growth not yet fully leveraged across platforms (Mcdelivery, Mccafe and McBreakfast), as highly capitalized online food aggregators show extreme thirst for expansion and gradual development of Café culture in India c) Opportunity for massive store openings (potential 3x number of stores has current).

Promoter/Fii Holdings
The promoters held 56.98% of the company’s capital as of March 31, 2022, while the FIIs held 9.94% and the DIIs 22.84%.

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