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PreIPO,Upcoming IPO • July 12, 2021

Mayasheel (BAZAR India) Retail India Limited

Mayasheel (BAZAR India) Retail India Limited is an Indian Retail Company incorporated in 2014, it is one of India’s up-and-coming retailers and offers Home Furnishing, Household goods and apparel. The company primarily operates in Tier-II and Tier-III cities. The company has established stores in Tier-II and Tier-III cities which are primarily located as standalone stores in high-street areas and shopping hubs of such cities and provide services to expanding aspiring class and middle class.

 

Bazar India CEO Mr Atul Garg is a visionary person and according to him Tier-II and Tier-III cities are under-penetrated by big retailers and Bazar India is focusing on those markets only and provides “ONE STOP SHOP” which caters for the complete fashion need of the entire family at most affordable prices.

 

Bazar India currently has 56 Stores in 54 Cities across India like U.P, Bihar, M.P, Uttarakhand, Northeast etc and the company is planning to have 100+ stores by the end of 2021.

 

Bazar India has a similar business model to V-Mart but Bazar India total income was Rs. 360 Crore in FY20 while V-Mart total income was Rs. 1,666 Crore and it is in business for the last 18 years while Bazar India started its operation in 2015. The inventory turnover ratio (which indicates the rate at which a company sells and replaces its stock of goods during a particular period) of V-mart is 3.5x whereas Bazar India has an inventory turnover ratio of 2.8x.

 

In 2016 companies PAT (Profit after tax) was Rs. 47.3 Lakh and within the 3-year company had a PAT (Profit after tax) of Rs. 6.3 crore showing a growth rate of 265% after that company tried to expand its operation aggressively due to which there was a drop-in company PAT like in 2019 company had a loss of 5.3 Crore and in 2020 company had a loss of 17.5 crore. 

According to Mr Atul Garg, Bazar India will have more than 250+ stores in the next 3 years (they currently have 56 stores PAN India) which shows the company is determined to grow aggressively and these activities will yield good growth in future.

 

Valuations

Peers

 

Lorenzini Apparels Ltd.

Thomas Scott (India) ltd.

Mayasheel (Bazar India) Retail India Ltd.

Arvind Fashions ltd

V-Mart

 

2020

2020

2020

2020

2020

Share Price (Rs)

6

20.4

40

139.9

3007

Revenue (in crores)

36

22

361

3926

1667

EBITDA

-7.9

2.5

3.8

243.7

218

PAT (INR in Cr.)

-0.4

-193.5

-17.5

-97.1

49

EV/EBITDA

-9.9

64.1

29.8

127.1

11.4

D/E Ratio

0.5

1.5

2.4

2.1

0.0

Inventory Turnover Ratio

2.3

3.6

2.8

3.4

3.5

 

On comparing Bazar India with its peers, we can see Bazar India have a healthy revenue only V-Mart and Arvind Fashions have more revenue than Bazar India but both these companies are in operations for decades and Bazar India started its operations just 5 years ago. The industry average for EV/EBITDA is 35.1 and the EV/EBITDA of Bazar India is 29.8 which makes it undervalued. Coming to D/E (Debt to Equity) ratio Bazar India has a little high D/E ratio compared to its peers and the Inventory turnover ratio of Bazar India have a very good inventory turnover ratio of 2.8 compared to its peers like Arvind fashions have inventory turnover ratio of 3.4 and V-Mart have inventory turnover ratio of 3.5.

Overall, we feel the company is on right track and under the leadership of Mr Atul Garg company will further grow aggressively.

About the Author:

Planify India | 101 Posts

Planify is a fintech startup that is focused to build India's first Private Equity Stock Exchange. Planify offer stocks that are yet not listed to Investors (Angel, Accredited Investors, VC, AIF and PE Funds) so that the exchange of hands can become easy in unlisted companies.