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IDBI Capital Report
Safari Industries India Ltd. reported better than expected Q1 FY22 result. Its sales/ Ebitda were significantly above our estimates.
Safari Industries’ net sales increased by five times YoY to Rs 1,202 million on a very weak base of Q1 FY21.
Even Ebitda improved to Rs 71 million compared to loss in Q1 FY21 and interest cost fell 49% YoY to Rs 10 million.
Hence, net profit improved to Rs 25 million (loss of Rs 193 million in Q1 FY21), but fell 60% QoQ as restriction in travel affected not only top-line but also logistics costs.
We raise our FY22/FY23 sales/Ebitda estimate by 23%/17% as we anticipate the improvement in travel and tourism which in turn should lead to higher luggage sales.
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