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Investing.com - Morgan Stanley initiated coverage on Aditya Birla Lifestyle Brands (ABLBL:IN) with an Overweight rating and a price target of INR175.00.
The investment bank highlighted ABLBL’s core lifestyle brands business, noting its strong portfolio with an established track record of growth, profitability, and cash generation.
Morgan Stanley believes the recent de-merger ensures renewed focus on the business and frees up capital for the company to invest in expanding its retail network.
The firm projects ABLBL to deliver a 10% revenue CAGR from fiscal 2025-2028, compared to a 7% CAGR from fiscal 2020-2025, driven by acceleration in retail area additions with stable margins.
According to Morgan Stanley’s estimates, the stock currently trades at 13x fiscal 2027 estimated EV/EBITDA, which it considers cheaper than the discretionary and retail companies in its coverage that trade at 37x on average, suggesting opportunity for multiple expansion with consistent execution.
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