Buy Safari Industries India; target of Rs 1610: Prabhudas Lilladher

Moneycontrol • 1 day ago

Original source

Key Investment Pillars

  • Safari Industries (India) plans to increase capacity by 6 lac pieces per month through debottlenecking existing units at Jaipur and Halol, expected to be complete by June-28.
  • The company expects to take a mid-single digit price hike from Nov'26 onwards.
  • Proposed expansion will lend cost competitiveness and drive growth.
  • Led by capacity expansion, we expect a topline CAGR of 13% over the next 3 years with EBITDA margin of 12.0%/13.2%/13.4% in FY27E/FY28E/FY29E respectively.

Thesis Validation Checklist

  • Investors should watch for the successful completion of the capacity expansion and its impact on cost competitiveness.
  • Monitor the implementation and effect of the mid-single digit price hike on revenue and margins.
  • Track the company's ability to maintain or improve its EBITDA margin in the face of stiff competition and raw material inflation.
  • Observe the progress of the new product launches, such as Carlton, and their contribution to revenue growth.