EPL Limited’s shares jumped almost 5% on positive Q2 FY25 results, with robust growth in revenue and net income. For the second quarter ending September 30, 2024, EPL reported sales of ₹10,862 million, up from ₹10,016 million in the same period last year, reflecting an 8.4% year-on-year growth. Revenue reached ₹11,002 million, up from ₹10,112 million, while net income surged to ₹870 million from ₹505 million, a 72% increase.
Basic earnings per share (EPS) from continuing operations rose to ₹2.73 from ₹1.58 a year ago, with diluted EPS at ₹2.72. For the first half of the fiscal year, sales grew to ₹20,936 million compared to ₹19,118 million a year ago, while revenue increased to ₹21,141 million from ₹19,314 million. Net income also saw a strong rise to ₹1,512 million, compared to ₹1,048 million in the previous year.
Nomura reaffirmed its ‘Buy’ rating on EPL, setting a target price of ₹290, suggesting a potential upside of 14% from the current price of ₹253.50. Key insights from Nomura’s analysis include:
- Q2 Performance: Sales growth of 8.4% YoY was slightly below estimates, but the operating profit margin (OPM) of 20.3% exceeded expectations of around 19%.
- Revenue and Profitability Guidance: EPL maintained its double-digit revenue growth guidance for FY25, with improved gross profit margins (GPM) and meeting OPM targets.
- Medium-Term Outlook: Nomura emphasized EPL’s favorable medium-term growth prospects, with potential sales and EBITDA growth reinforcing a positive outlook.
The strong performance and positive analyst outlook have fueled investor optimism around EPL’s growth trajectory, positioning it well for future gains.
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