Nomura has maintained its reduce rating on Phoenix Mills with a target price of ₹1,350 per share, expressing concerns over subdued retail consumption growth and elevated valuations. The brokerage noted that the company reported a 13% year-on-year increase in retail consumption during the second quarter of FY26 and 12% growth for the first half — broadly in line with its full-year estimate of 11% growth.
However, Nomura described the overall consumption growth as unexciting and said that due to ongoing tenant churn, retail income growth is likely to lag consumption growth in Q2FY26. The brokerage believes that the key factor to monitor in the coming quarter will be the impact of the recent GST rate cut on retail spending, especially as Q3 typically represents Phoenix Mills’ strongest period of the year.
Nomura further noted that the stock currently trades at 23x FY27F earnings, which it considers expensive relative to an estimated EBITDA CAGR of around 15% between FY25 and FY28, compared to 43% CAGR achieved between FY22 and FY25.
Disclaimer: The views and recommendations above are those of Nomura. Business Upturn does not endorse them. Please consult a financial advisor before making investment decisions.
