MOSL: SHOPPERS STOP (Neutral)-New strategies in place, but growth remains muted
SHOPPERS STOP: New strategies in place, but growth remains muted
(SHOP IN, Mkt Cap USD0.5b, CMP INR407, TP INR450, 11% Upside, Neutral)
We met the management of Shoppers Stop (SHOP) to discuss the company's upcoming strategy and growth levers. Key insights highlighted below:
- To combat the retail market slowdown, SHOP has taken noteworthy efforts over the last one year to rejig its Private Label portfolio and to improve throughput and footprint addition.
- Management has revised its store addition target to 6-8 new Shoppers Stop stores (v/s earlier 4-5) and 15-20 new Beauty stores, with mid-to-high single-digit same store sales growth (SSSG) for FY20.
- Further, it has changed its strategy with respect to the store size; plans are afoot to add smaller-sized stores of ~25-30k sq.ft v/s earlier 45-50k sq.ft.
Shoppers Stop Limited is a holding company. The Company is engaged in the business of retailing a range of household and consumer products through departmental stores. It operates through approximately 80 such departmental stores located in approximately 40 cities. Its products include apparels and non-apparels. Its non-apparel category includes cosmetics, personal accessories and leather goods, home wares, electronics, books and music. The Company, through its Website, Shoppersstop.com, offers international and national brands in men's, women's and kids apparel; gifts and fashion accessories, such as ladies watches, men's watches, artificial jewelry, fine jewelry, handbags, fragrances, men's and women's footwear, home furnishing and decor products. It has over six private brands namely STOP, Kashish, Life, Haute Curry, Velorio Fratini and Elliza Donatein. It offers First Citizen Loyalty Program for customers. Its application is available on Google Play Store and Apple App Store.
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