Shoppers stop
Q4FY13 Results: Above estimates
RETAIL : Quarterly Update
30th April 2013
Shoppers Stop’s Q4FY13 results (standalone) were above our
estimates largely on account better than expected EBITDA margins.
The variance is mainly on account of higher than expected gross
margins expansion.Hyper city’s performance was in line with our
expectations; volume growth of 3% during the quarter after decline
witnessed in last 4 consecutive quarters was encouraging.
Shoppers Stop

Standalone Revenues grew by 17% YoY led by Same Store Sales
(SSS) of 10% as against 12.5% in Q3FY13 and 10% in Q4FY12.
Volume growth at 1% remained muted during the quarter. LTL
sales growth of stores < 5 years was impressive at 19%.

EBITDA margins at 5.7% decreased by 50 bps (YoY) despite
improvement in gross margins (120 bps (YoY) (likely on account of
higher apparel share) which were partially offset by significant
increase in employee cost (growth of 29%YoY) and other
operating expenses (up 80 bps YoY). We note that the lease
charges remained flat on sequentially basis while the
electricity expenses declined by 10% (QoQ).

Inventory /sqft increased to Rs 720 as against Rs668 in Q4FY12.

Apparels maintained healthy share of revenue mix at 60.3% as
against 57.4% in Q4FY12.

ASP increased by 8% YoY contributing to growth.

Capex during the quarter was Rs337 mn.
Hypercity

Hypercity’s revenues grew by 7% YoY led by 11% SSS (adjusted
for Ex-mobile) as against 6% SSS in Q4FY12 and 5% in Q3FY13.
LTL volume was positive 3% after 4 consecutive quarters of
decline. The business is realigned as the Mobile retiling business
is now being run as the mobile store as a concessionaire.

We highlight that during the quarter the total area under operation
reduced from 1.23mnsqft to 1.15mn sqft would likely be on
account of downsizing of its existing stores (possibly Amritsar
store)

Company has recorded Store level EBITDA positive from last 7
consecutive quarters at Rs 10.7mn and company level EBITDA
loss stood at Rs85 mn driven by 9% (YoY) increase in Store
operating expenses.

The company incurred a loss of Rs219 mn during the quarter and
we estimate that Rs219 mn of fresh capital was infused in the
company during the period. We note that Hypercity’s loans from
Under Review
SHOP IN | CMP RS 373
Abhishek Ranganathan (+ 9122 6667 9952)
abhishekr@phillipcapital.in
Neha Garg (+ 9122 6667 9996)
ngarg@phillipcapital.in
Shareholders/group
Rs835mn.
companies
have
remain
flat
QoQ
at
Store additions
The company opened 1 Home Stop, 1 MAC standalone, 1 Clinique and
1 Crossword stores during the quarter resulting in an addition of
0.05msf. During the quarter, company shifted 1 Jaipur shoppers stop
store to new location Jaipur Trade Park. The total area under
shoppers stop (standalone) is now at 3.39 msf and Hyper city at 1.15
msf.
Hypercity’s Performance
Q4FY1 Q3FY1
2
3
Particulars (Rs Mn)
Retail Sales (Net of VAT)
Gross Margin
Gross Margin%
DC Cost
Damages / Others
Net Margin
Net Margin%
Store Operating Expenses
Other Retail Operating
Income
Store EBIDTA
1,637
346
21.2%
22
14
311
18.98
%
346
1,996
422
21.2%
26
Q4
FY13 YoY
1,757
369
21.0%
23
-12%
-13%
8%
9 38%
337 9%
-12%
1%
9%
-1%
-10%
52 42%
873
11
%
-9%
10
386
19.30
% 19.20%
422
378
36
57
1
20
QoQ
7%
7%
Store EBIDTA % to Sales
0.07% 1.00% 0.60%
SO Expenses
95
93
96 1%
COMPANY EBIDTA
(94)
(72)
(85) -9%
Exceptional Item
Depreciation
43
82
53 23%
Finance Charges
85
82
80 -6%
PAT
(222)
(236)
(219) -2%
Source: Company, PhillipCapital India Research
-14%
-13%
-48%
40.00
%
4%
18%
-35%
-2%
-7%
Standalone Performance
_____________Standalone
_____________
Rs Mn
Income
Gross Profit
Q4FY12
5,863
1,928
Q4FY13
6,757
2,303
YoY Growth
15%
19%
Commen
ts
Growth
led by
10% LTL
sales
Gross Margin
32.9%
34.1%
EBITDA
363
383
EBITDA
Margin
6.2%
5.7%
Depreciation
115
125
Interest
74
79
PBT
218
214
Tax
81
62
PAT
137
152
PAT Margin
2.3%
2.2%
Source: Company, PhillipCapital India Research
5%
9%
6%
-2%
-23%
10%
Balance sheet (Consolidated) (Rs Mn)
EQUITY AND LIABILITIES
SHAREHOLDERS' FUNDS
Share capital
Reserves and surplus
Net Worth
Minority Interest
NON CURRENT LIABILITIES
Long-term borrowings
Deferred tax liabilities(net)
Other long-term liabilities
Total Non Current Liabilites
CURRENT LIABILITIES
Short-term borrowings
Trade payables
Other current liabilities
Short-term provisions
Total Current Liabilites
Total
ASSETS
NON CURRENT ASSETS
Total Fixed assets
Goodwill on consolidation
Non current investments
Deferred tax assets (net)
Long term loans and advances
Other non-current assets
Total Non Current Assets
CURRENT ASSETS
Inventories
Trade Receivables
Cash and cash equivalents
Short term Loans and advances
Other current assets
Total Current Assets
Total
Mar-12
Mar-13
YOY
413
4,748
5,160
39
415
4,594
5,009
46
1%
-3%
-3%
16%
944
2
8
955
1,662
63
0
1,725
76%
2568%
-98%
81%
2,883
3,198
1,729
100
7,909
14,064
3,044
3,814
1,619
113
8,591
15,371
6%
19%
-6%
13%
9%
9%
6,481
987
0
0
2,155
54
9,678
6,740
987
0
2,396
92
10,215
4%
0%
0%
-100%
11%
71%
6%
3,311
263
150
587
74
4,386
14,064
3,698
322
268
757
111
5,156
15,371
12%
22%
78%
29%
49%
18%
9%
Source: Company, PhillipCapital India Research
Balance sheet (Standalone) (Rs Mn)
EQUITY AND LIABILITIES
SHAREHOLDERS' FUNDS
Share capital
Reserves and surplus
Net Worth
NON CURRENT LIABILITIES
Long-term borrowings
Long-term provisions
Total Non Current Liabilites
CURRENT LIABILITIES
Short-term borrowings
Trade payables
Other current liabilities
Short-term provisions
Total Current Liabilites
Total
Mar-12 Dec-12 Mar-13
413
414
6,172 6,436
6,585 6,851
350
2
352
475
101
576
415
6,523
6,938
YOY
QoQ
1%
6%
5%
0%
1%
1%
1,125 221% 137%
63 2564% -38%
1,188 237% 106%
1,841 1,698 1,943
2,361 3,297 2,847
1,423 1,670 1,361
93
4
103
5,718 6,669 6,254
12,655 14,096 14,380
6% 14%
21% -14%
-4% -18%
11% 2570%
9%
-6%
14%
2%
ASSETS
NON CURRENT ASSETS
Total Fixed assets
4,466 4,729 4,834
8%
2%
Non current investments
2,842 3,182 3,309 16%
4%
Long term loans and advances
2,503 2,763 2,754 10%
0%
Other non-current assets
79
Total Non Current Assets
9,811 10,674 10,976 12%
3%
CURRENT ASSETS
Inventories
2,120 2,445 2,438 15%
0%
Trade Receivables
192
241
204
6% -15%
Cash and cash equivalents
71
65
117 64% 82%
Short term Loans and advances
389
594
586 50%
-1%
Other current assets
71
78
59 -18% -25%
Total Current Assets
2,844 3,422 3,403 20%
-1%
Total
12,655 14,096 14,380 14%
2%
Source: Company, PhillipCapital India Research
.
– For additional reports visit Bloomberg, Thomson Analytics
Regards,
Abhishek Ranganathan, CFA
Vice President
Retail, Real Estate | Institutional Equity Research
PhillipCapital (India) Private Limited
No. 1, 2nd Floor, Modern Centre, 101 K.K. Marg,
Jacob Circle, Mahalaxmi, Mumbai 400 011
Tel: +9122 6667 9952 (D), +9198204 98743 (M)
abhishekr@phillipcapital.in | www.phillipcapital.in