Multibagger stock to pay 700% dividend soon, ex-date falling this week: Buy?

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With a market capitalization of 53,056.47 Cr, Page Industries Ltd. is a large-cap business that operates in the consumer discretionary industry. For the production, distribution, and marketing of the JOCKEY® brand in India, Sri Lanka, Bangladesh, Nepal, and the UAE, Page Industries Limited, headquartered in Bangalore, India, holds a well-known name. In addition, Page Industries holds a sole agreement with Speedo International Ltd. to manufacture, sell, and distribute the Speedo brand in India. The company has declared a 700% dividend at a face value of 10 or 70 per share. As per the data available on BSE, the company has fixed 18/11/2022 as the record date and the ex-dividend date is falling on 17 November 2022.

The company has said in a stock exchange filing that “The Board of Directors of the Company at their meeting held today (i.e., 10 November 2022) has declared 2nd Interim Dividend 2022-23 of Rs. 70/- per equity share. As informed earlier, the record date fixed for the payment of interim dividend is 18 November 2022. The date fixed for payment of dividend is on or before 9 December 2022.”

In the quarter that ended in September 2022, Page Industries’ net profit increased by 1.02% to 162.13 crore from 160.49 crore in the same quarter last year. In comparison to the 1084.01 Cr reported in Q2FY22, the firm reported net sales of 1255.02 Cr in Q2FY23, reflecting a YoY rise of 16%. In Q2FY23, EBITDA totalled Rs. 237.9 crores, up 2% year-on-year but down almost 20% quarter on quarter. Margin levels were approximately 19%. The EPS climbed to 145.36 per share in Q2FY23 compared to 143.88 in Q2FY22 and 185.62 in Q1FY23. Page Industries has announced an equity dividend of 3700.00%, or 370 per share, for the fiscal year that ended on March 31, 2022, or FY22. This yields a dividend at the current share price of 47,499.95 of 0.77%.

The research analysts of the broking firm ICICI Securities said on Friday that “Page had a softer-than-expected print with revenue growth of 16% YoY (1% volume growth). Management’s clarification that core (excluding masks) sales grew 20% with 7% volume growth did help but we would have appreciated this clarity last year itself. EBITDA margin of 19.0% was also lower than the (annual) guided range of 20-21%. We like efforts to find new avenues for growth – kids (model still being fine-tuned) and athleisure range along with penetrating the rural markets. Besides, our checks suggest good demand traction for women innerwear. Focus also continues on expanding distribution (across segments / channels). From a medium-to-long term perspective, we believe Page does have (operating) margin expansion potential with Page’s EBITDA margins having remained in the narrow range of 18-21% for the last 10+ years. We believe Page has front-ended investments in new avenues. Maintain ADD; TP Rs52,000.”

The research analysts of the broking firm ICICI Direct Research said on Friday that “Page’s share price has grown ~2.0x in past five years. We maintain HOLD recommendation on the stock. We value Page at 51770 i.e. 66x FY24E EPS.”

The shares of Page Industries Limited closed on Friday at 47,499.95 apiece, down by 2.40% from the previous close of 48,666. In its last trading session, the stock recorded a total volume of 39,220 shares compared to the 20-Day average volume of 18,477 shares. In the last 5 years, the stock has delivered a multibagger return of 102.59% and in the last 3 years, the stock has gained 98.23%. In the last 1 year, the stock has gained 16.62% and 16.05% YTD so far in 2022.

Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.

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