Shares of Aditya Birla Fashion and Retail Ltd (ABFRL) rose 1.78% to ₹90.44 on Tuesday, September 9, after global brokerage Morgan Stanley upgraded the stock to ‘Overweight’ with a target price of ₹113.
Brokerage view
Morgan Stanley believes ABFRL is at the cusp of improving fundamentals, led by profitability improvement and supported by its growing presence in India’s luxury and ethnic wear markets. The brokerage expects a 14% revenue CAGR and 27% EBITDA CAGR between FY27–28, projecting an attractive risk-reward at 10x FY27E EV/EBITDA.
Market momentum
The upgrade comes as a boost to ABFRL shares, which have been under pressure in recent months. On Tuesday, the stock traded in the range of ₹90.20 – ₹92.48, with a market capitalization of ₹1.1 lakh crore.
Morgan Stanley further noted that ABFRL’s designer-led ethnic and luxury businesses make it a strong play on India’s fast-growing luxury consumption market, which could support a potential valuation re-rating in the coming years.
