Page Industries volume recovery and JKY Groove traction support FY27 growth

Investment View and Valuation

Motilal Oswal Financial Services Ltd. retained its Buy rating on Page Industries after a strong exit to FY26 and constructive management commentary on volume-led growth in FY27. The broker’s target price is Rs 45,000, based on 50 times FY28E EPS. It raised its FY27E and FY28E EPS estimates by 3–4 per cent following better-than-expected revenue delivery in 4QFY26.

Strong 4QFY26 Performance

Page Industries delivered an all-round beat in 4QFY26. Revenue increased 14 per cent year-on-year to Rs 12,526 million, while volume grew 10.8 per cent year-on-year to 54.5 million pieces. This represented a substantial acceleration from 1.4 per cent volume growth in 3QFY26 and marked a sharp recovery after revenue growth of only 4 per cent in the first nine months of FY26.

Demand Recovery and JKY Groove Traction

Consumer confidence and retail demand remained healthy, with premiumisation, value-added premium products and outerwear supporting average selling prices. Management attributed the gap between value and volume growth largely to premiumisation and favourable mix rather than price increases.

Athleisure demand recovered as channel inventory normalised. JKY Groove showed strong traction and expanded across 500 exclusive brand outlets, selected multi-brand outlets and e-commerce channels. Management said the demand recovery was especially visible in March, while January and February were also better than the first three quarters of FY26.

Margin Pressure and Cost Mitigation

Margin pressure remains an important consideration. Fourth-quarter gross margin declined 250 basis points year-on-year to 58.4 per cent, below the broker’s 60.4 per cent estimate, due to cotton and other raw-material inflation. Page Industries implemented approximately 2 per cent price increases in January 2026 alongside product upgrades and indicated that further increases were likely in 1QFY27 to counter input-cost pressure.

The company plans to mitigate cost pressure through strategic sourcing, supply-chain optimisation, operational efficiencies and calibrated pricing. Despite the gross-margin pressure, 4QFY26 EBITDA and adjusted PAT were ahead of the broker’s estimates.

FY26 Performance and FY27 Operating Outlook

For FY26, Page Industries reported revenue, EBITDA and adjusted PAT growth of 6 per cent, 9 per cent and 10 per cent, respectively. Management retained its FY27 EBITDA-margin guidance of 19–21 per cent, compared with 22 per cent in FY26, as marketing and business investments are expected to remain elevated.

Management aims for double-digit volume growth in FY27 despite price hikes, while Motilal Oswal models 8 per cent volume growth. The broker expects product innovation, social-media marketing and new-channel expansion to support growth and forecasts an 11 per cent revenue and EBITDA CAGR over FY26–28E.

Motilal Oswal Estimates

Inventory, Working Capital and Competitive Environment

Finished-goods and raw-material inventory days increased to 73 at FY26-end from 64 at the beginning of the year. Management described this as deliberate stocking to hedge against raw-material inflation, prepare for demand recovery and ensure supply readiness for the seasonally stronger first quarter. Net working-capital days increased modestly to 56 from 54.

Motilal Oswal sees easing competitive intensity and industry consolidation, particularly among direct-to-consumer brands, as supportive for larger organised players. Management noted that several direct-to-consumer and emerging brands have curtailed offline expansion, consolidated operations or reduced discounting and marketing intensity.

Key Risks

• Sustained raw-material inflation and insufficient pricing offset.
• Lower-than-expected consumer demand or volume growth.
• Continued elevated marketing expenditure.
• Renewed competitive intensity.