Kotak Institutional Equities has initiated coverage on Vishal Mega Mart (VMM) with an ‘Add’ rating and a target price of ₹110, highlighting the company’s leading position in the diversified retail segment.
The brokerage forecasts a steady 17% CAGR in revenue over FY2025-28E, driven by a combination of same-store sales growth (SSSG) of 9-13% and retail area CAGR of 12.6%. Vishal Mega Mart’s cost-efficient operations, robust supply chain, and focus on private-label merchandise are expected to support EBITDA CAGR of 18% and PAT CAGR of 24% over the same period.
The retailer’s low-cost, high-quality apparel segment and private-label offerings continue to provide steady margins, while its asset-light model ensures healthy return ratios, making it an attractive long-term investment, according to Kotak.
