Initiating Coverage | 16 November 2015
Sector: Consumer
Page Industries
Getting into the big league
Manish Poddar
(Manish.Poddar@MotilalOswal.com) +91 22 3027 8029
Gautam Duggad
(Gautam.Duggad@MotilalOswal.com); +91 22 3982 5404

Page Industries
Contents
Getting into the BIG league .................................................................................3
Key Investment Charts .........................................................................................5
Indian apparel industry shifting toward organized players .................................... 7
Page Industries—a dominant player with several first-mover advantages ............. 9
Innerwear opportunity is BIG; Page has a
right to win
........................................ 12
Segment-wise analysis ....................................................................................... 13
Significant room to expand distribution ............................................................. 20
‘Affordable yet aspirational’ positioning ............................................................ 22
Strong manufacturing set-up—an entry barrier for competitors ......................... 24
Fastest growing consumer franchise with deep and wide MOAT ......................... 26
Long-term construct: Page can be a multi-year compounder............................... 30
Management details and shareholding pattern .................................................. 33
Financials and Valuations .................................................................................. 34
16 November 2015
2

Page Industries
BSE Sensex
25,611
S&P CNX
7,762
Page
Consumer
Initiating Coverage | Sector:
Industries
CMP: INR12,156
TP: INR14,500 (+19%)
Buy
Getting into the BIG league
Fastest growing consumer franchise with deep and wide moats
Stock Info
Bloomberg
Equity Sh (m)
52-Wk Range INR
1, 6, 12 Rel. Per (%)
M.Cap. (INR b)
M.Cap. (USD b)
12M Avg Val (INR M)
Free float (%)
PAG IN
11.2
16995 / 9207
-11/-6/35
135.5
2.1
189
48.2
Page Industries (‘PAGE’) offers a compelling multi-year premiumization play in a
fast growing category, backed by favorable demographics and rising affluence.
It is the fastest growing consumer franchise and we expect this growth to sustain,
driven by large industry opportunity and PAGE's unique strengths.
We initiate coverage with a Buy rating and target price of INR14,500. Given the
rich valuation it commands, even looking beyond one year, we see PAGE as a
multi-year consumer story.
Financial Snapshot (INR Billion)
Y/E Mar
2015 2016E 2017E
Sales
15.4
18.0
22.9
Sales Gr. %
29.9
16.9
27.1
EBITDA
3.2
3.9
4.9
EBITDA Gr. % 25.1
21.4
25.5
PAT
2.0
2.3
3.0
EPS (INR)
175.7 210.4 272.5
EPS Gr. %
27.5
19.7
29.6
FCF to PAT
0.6
0.7
0.6
BV/Sh.INR
346.8 451.9 588.2
RoE (%)
50.7
46.5
46.3
RoCE (%)
41.6
41.0
43.4
Payout (%)
48.9
50.0
50.0
P/E (x)
69.2
57.8
44.6
EV/EBITDA(x) 43.0
35.3
28.1
Shareholding pattern (%)
As on
Jun-15 Mar-15 Sep-14
Promoter
51.0
51.0
51.0
DII
6.3
6.5
5.2
FII
32.9
32.3
33.7
Others
9.8
10.2
10.1
FII Includes depository receipts
Stock Performance (1-year)
Capitalizing shift towards organized segment in a high growth category with
underlying premiumization:
The Indian innerwear market is an INR200b (8.1%
of Indian apparel market) opportunity and is growing at 11% CAGR (over FY10-
15). It is characterized by a large unorganized segment, but favorable macro
factors like rising incomes, demographics, urbanization, and higher proportion
of working women are driving the shift towards organized branded innerwear.
Page Industries dominates the premium branded space, given its first mover
advantages in brand building, control on manufacturing, Jockey’s global lineage,
portfolio width, and lack of credible and relevant competitors in the premium
space. Page is at the forefront of underlying premiumization in the innerwear
category, with industry leading growth, margins and return ratios.
Consistent outperformance even in a challenging macro environment:
The
strength of Page’s business model is also reflected in its financials. It has posted
a CAGR of 35% in sales, 36% in EBITDA, and 38% in PAT over FY10-15, a period
characterized by challenging macros. It has posted high teens volume CAGR,
significantly outperforming peers like Lovable, Maxwell, and Rupa. Superior
brand equity and positioning as a premium-yet-affordable brand have been the
key contributors, in our view.
Innerwear opportunity is BIG; Page has
right to win:
The innerwear segment
constitutes 8.1% of the apparel industry, but is the fastest growing piece. As per
Industry estimates, the segment is expected to grow from INR178b in 2013 to
INR595b in 2023 – a CAGR of 13%. The ‘premium and above’ sub-segment
constitutes ~20% of the market, offering a sizable premiumization-led growth
opportunity. We believe Page has a ‘right to win’, given its aspirational
positioning, wide portfolio, and strong backend advantage. Despite a strong
track record of growth over the last 20 years, Page has enough headroom to
grow, in our view. Continued premiumization, portfolio expansion in existing
product segments (men’s and women’s innerwear), and distribution expansion
in existing markets as also entry into new segments (kidswear) and markets
(distribution reach 1/4th of Rupa) can ensure multiple years of 20%+ revenue
growth, in our view.
3
16 November 2015

Page Industries
Fastest growing consumer franchise, with deep and wide moats:
We expect
Page to continue gaining market share and deliver 23% sales CAGR over FY15-
18. We model EBITDA margins of 20-22%, as our multiple management
interactions suggest Page’s preference for driving consistent predictable growth
over sharp jump in profitability, in turn leading to higher competitive intensity.
Despite high base of 38% PAT CAGR over FY10-15, we build in 27% EPS CAGR
over FY15-18. We expect growth to sustain even post FY18. Our long term P&L
construct indicates that Page has the potential to deliver 20%+ sales and PAT
CAGR over FY15-25, largely driven by steady market share gains in an expanding
pie.
Earnings visibility to support premium valuations; initiate with Buy:
Page
offers a compelling, capital-efficient long-term lifestyle play on the
premiumizing innerwear category. 4/5th of the innerwear category is still sub-
premium and provides a decent runway for premiumization-led growth. A
widening product and brand portfolio, coupled with distribution expansion will
aid share expansion and drive multiple years of growth, in our view. We initiate
coverage with a
Buy
rating and target price of INR14,500 (41x FY18E EPS – three
year average P/E). Given the strong earnings visibility, steady return ratios and
lack of credible / relevant competitors in the premium space, we expect the
premium valuations to sustain. We believe the stock offers healthy long-term
returns potential; we expect 21% CAGR over
three
years and 22% CAGR over
eight years. Heightened competitive intensity from international brands and
potential labor issues (has ~18k employees on rolls) are key risks.
16 November 2015
4

Page Industries
Key Investment Charts
Exhibit 1: Innerwear market forms 8.1% of the Apparel
Market, one of the fastest growing segments
Innerwear market (INR b)
595.4
Exhibit 2: PAGE outperformed peers by a wide margin
Sales CAGR (%)
PAT CAGR (%)
22.2
35.0
37.7
322.1
177.5
14.7
4.3
(0.0)
(0.0)
Maxwell
13.3
2013
2018E
2023E
Lovable
Rupa Industries
Page
Source: Industry, Company, MOSL
Source: Company, MOSL
Exhibit 3: Consistent high teens volume growth in the last
five years (on blended basis) despite macro slowdown
Volume Growth (%)
Price Growth (%)
Exhibit 4: PAGE gradually foraying into segments with
higher realization
Average price (INR)
11.3%
Price CAGR (FY10-FY15)
12.6%
10.2%
14.2
16.6
8.2
26.9
19.2
FY12
16.8
FY13
16.4
16.7
FY14
9.2
18.2
FY15
5.2
10.5
1HFY16
105.1
Men
115.1
Women
191.3
Liesurewear
Source: Company, MOSL
FY11
Source: Company, MOSL
Exhibit 5: PAGE’s growth was broad based over FY10-15(%)
Mens
Womens
38
30
19
Leisure
47
Others
Total
35
Exhibit 6: Contribution of Leisurewear rising
Mens
3
19
16
2
22
16
Womens
2
23
18
Liesurewear
2
25
19
2
30
18
50
Others
2
30
18
51
62
59
57
54
Mens
Womens
Leisure
Others
Total
FY10
FY11
FY12
FY13
FY14
FY15
Source: Company, MOSL
Source: Company, MOSL
16 November 2015
5

Page Industries
Exhibit 7: PAGE derives significant revenue contribution (%)
from traditional channels
Large
Format
Stores, 6
EBO, 9
Exhibit 8: Doubled EBO count in 2 years, PAGE intends to
take the total count to 300 by FY16 end
Store Count (beginning of the year)
Net Additions
47
Hoseiry, 45
39
MBO, 40
11
32
FY09
Source: Company, MOSL
11
43
FY10
13
54
FY11
4
67
FY12
29
71
FY13
100
FY14
54
240
139
FY15 1HFY16
Source: Company, MOSL
Exhibit 9: We expect 27% PAT CAGR over FY15-FY18...
Revenue CAGR (%)
35.0
37.7
23.3
26.7
PAT CAGR (%)
Exhibit 10: …with steady EBITDA margins
EBITDA Margin (%)
21.0
20.2
19.3
21.5
20.7
21.5
21.2
21.7
FY10 - FY15
FY 15 - FY18
Source: Company, MOSL
FY11
FY12
FY13
FY14
FY15 FY16E FY17E FY18E
Source: Company, MOSL
Exhibit 11: Page’s cash conversion cycle is better than peers
despite lower payable days
215
134
Lovable
200
142 153
90
Maxwell
Rupa Industries
175
173
142
96
Page
202
190
164
98
Exhibit 12: Capital efficient business model
RoE
RoCE
148
95
194
162
147
89
FY11
FY12
FY13
FY14
FY15
FY11
FY12
FY13
FY14
FY15
FY16E FY17E FY18E
Source: Company, MOSL
Source: Company, MOSL
16 November 2015
6

Page Industries
Indian apparel industry shifting toward organized
players
High-growth segment with underlying premiumization
The Indian apparel market is ~USD40b and has grown 8% over FY10-FY15. A surge in
demand for readymade apparel (convenience, designs and wide variety), rising
income levels (increasing discretionary spends), youth demographics and increasing
preference for branded apparel (increasing presence of organized retail and online
channel) are driving market resurgence. The Indian innerwear market stands at
~INR200b (8.1% of Indian apparel market) and has grown at 11% over FY10-
FY15. The market is characterized by a large unorganized segment, but favourable
macro factors like rising incomes, demographics, urbanization, a higher proportion
of working women are driving the shift toward organized branded innerwear
segment. From being considered as an essential commodity, the innerwear category
is increasingly witnessing a shift from being a functional to a fashion category and a
price-sensitive to a brand-sensitive category.
Exhibit 13: Indian apparel industry (~5.5% of India’s GDP) offers tremendous potential for branded players
Domestic Apparel
Market
(INR2,460b)
Mens
(INR1038b)
Women
(INR 930b)
Kids - Boys
(INR 258b)
Kids - Girls
(INR240b)
Innerwear
(INR68.7b)
Innerwear
(INR108.8b)
Source: Industry, Company, MOSL
Exhibit 14: Innerwear market forms ~8% of the apparel
market, one of the fastest growing segments
Innerwear market (INR b)
595.4
Exhibit 15: 48% of the industry in the hands of unorganized
players
322.1
177.5
Unorgaized,
48
Organized,
52
2013
2018E
2023E
Source: Industry, Company, MOSL
Source: Industry, Company, MOSL
16 November 2015
7

Page Industries
Exhibit 16: 4/5 of the market = mass segment (%)
Super
Premium
4
Premium
14
Economy
48
Medium
34
Men
Source: Industry, Company, MOSL
Women
10 11 11
9
10 11
th
Exhibit 17: Innerwear market by users (%)
2011
43 41
40
2016E
2021E
38 38 38
Boys
Girls
Source: Industry, Company, MOSL
16 November 2015
8

Page Industries
Page Industries—a dominant player with several first-
mover advantages
Page Industries (Page) enjoys a dominant position in the premium branded space
owing to its significant first-mover advantages in brand building, control on
manufacturing, global lineage of Jockey, width of the portfolio and lack of credible
and relevant competitors in the premium space.
Page is already at the forefront of underlying premiumization in the innerwear
category with industry-leading growth, margins and return ratios.
Consistent outperformance even in a challenging macro environment:
The
strength of Page’s business model is also reflected in its financials. The company has
posted a CAGR of 35% in sales, 36% in EBITDA and 38% in PAT over FY10-15, a
period characterized by challenging macros. Page has posted high-teens volume
CAGR, significantly outperforming peers like Lovable, Maxwell and Rupa. Superior
brand equity and positioning as a premium-yet-affordable brand has been key the
contributors, in our view.
Key strategies that drove Page’s outperformance v/s the industry
1)
Deepening the brand and geographic reach:
(i) Over the years, Jockey has
consistently deepened its portfolio by introducing new SKUs
(variants/styles/colors/patterns) in the existing offerings; for instance, Page
launched Signature Stretch (panty and bra range in FY11), Fashion Stretch
(panty and bra range in FY12), No Panty Line Promise (FY13) and Jockey
Seamless Shapewear range (FY14) in the Women’s innerwear segment. ii) It also
expanded its store reach from 800 stores in 1996 to ~30,000 stores (in 1200+
cities and towns across the country). Despite adding 10,000 stores in the last
three years, PAGE’s reach is still just 25% of its competitors Rupa Industries
(118,000 outlets) and Maxwell Industries (110,000 outlets).
2) Widening the portfolio:
(i) Over the years, PAGE has widened its portfolio
offerings by consistently foraying into adjacent unorganized segments (e.g.
leisurewear and sportswear). The strategy of venturing into related categories
and positioning itself as an affordable aspirational brand has improved product
mix and margins. (ii) PAGE also entered an exclusive license agreement with
Speedo International in July 2011; post the agreement, the brand Speedo has
witnessed an 8.5x increase in sales on low base in two years—with the products
available across 986 stores in 74 cities as on FY15. While the contribution of
Speedo will remain in low single digits in the foreseeable future, in our view, the
swimwear segment is expected to register strong growth on the back of by
demographic and lifestyle changes. Additionally, it allows Page to leverage its
reach to launch global premium brands in India.
16 November 2015
9

Page Industries
Exhibit 18: PAGE’s milestones since incorporation
Year
1995
1997
2001
2003
Key Event
Incorporation of the Company under the name and style of Page Apparel Manufacturing Private Ltd.
Launched Jockey products for women under the style of ‘Jockey For Her’
Launched the middle range of men’s undergarments
Retail network touched 100 towns
The turnover of the Company crossed INR 500m
Retail network of 10,000 outlets
Achieved production of 1m pieces a month
2004
2005
2006
2007
2010
2011
2012
2015
Launch of sub brand ‘Jockey Zone’
Launch of Jockey brassieres in India
The turnover of the Company crossed INR 1b in terms of factory selling price
Production crossed 2m pieces per month
Successful completion of IPO
PAGE launched the Just Jockeying campaign to transform Jockey into a lifestyle brand
Licensing agreement with Jockey International Inc. extended till 2030. Also been awarded the sole marketing and distribution
rights for UAE
Entered agreement with Speedo International for right to manufacture and distribute Speedo products in India
Launch of Brand Jockey in UAE
Launch of first International format EBO in Bangalore
Launched its own B2C e-commerce channel and tied up with various leading online retailers to increase reach of products
Source: Company, MOSL
Exhibit 19: SWOT analysis of Page
Globally successful brand
lineage
Over five decades of
business experience of
promoters with Jockey
International Inc.
Wide product range with
continuous new product
introduction (R&D
support from Jockey
International Inc.)
Strong distribution
network with efficient
working capital
management
Efficient Labor Relations
(smooth production flow)
Fragmentation within the
innerwear industry
Availability of quality
labor remains a hindrance
for the Industry
Existing Categories
New Categories
Shift in consumer demand
patterns from basic
necessity to spend as a
lifestyle product
Changing demographics,
Rising disposable income
and Increase in number of
working women
There is no substitution of
innerwear
Over the longer term PAGE
could explore adjacent
apparel categories and also
enter into license
agreements with global
brands- e.g. Speedo.
Competition
Advent of international
brands in the Indian
markets
Rise in import from other
countries
Macro Variables
Muted discretionary
spends for prolonged
period.
Raw material headwinds
(sharp rise in cotton prices)
Source: Company, MOSL
16 November 2015
10

Page Industries
Exhibit 20: PAGE posted solid 35% revenue CAGR over
FY10-FY15
Revenue (INR b)
44.6
40.0
25.7
11.9
Revenue Growth (%)
35.6
Exhibit 21: Broad-based performance across segments
[FY10-FY15 – Sales CAGR (%)]
Mens
Womens
38
30
19
Leisure
47
Others
Total
29.9
15.4
35
5.0
FY11
7.0
FY12
8.8
FY13
FY14
FY15
Mens
Womens
Leisure
Others
Total
Source: Company, MOSL
Source: Company, MOSL
Exhibit 22: Consistent high teens volume growth in the last
five years (on blended basis) despite macro slowdown
Volume Growth (%)
Price Growth (%)
Exhibit 23: PAGE gradually foraying into segments with
higher realization
Average price (INR)
11.3%
Price CAGR (FY10-FY15)
12.6%
10.2%
14.2
16.6
8.2
26.9
19.2
FY12
16.8
FY13
16.4
16.7
FY14
9.2
18.2
FY15
5.2
10.5
1HFY16
105.1
Men
115.1
Women
191.3
Liesurewear
Source: Company, MOSL
FY11
Source: Company, MOSL
Exhibit 24: PAGE incrementally focusing on segments other
than men’s innerwear to drive revenue growth…
Mens
3
19
16
2
22
16
Womens
2
23
18
Liesurewear
2
25
19
2
30
18
50
Others
2
30
18
51
Exhibit 25: Men’s innerwear volume contribution down to
61% (69% as on FY10)
Mens
3
11
17
2
14
17
Womens
2
15
18
Liesurewear
Others
0
1
1
16
20
19
19
20
19
62
59
57
54
69
67
65
64
60
61
FY10
FY11
FY12
FY13
FY14
FY15
FY10
FY11
FY12
FY13
FY14
FY15
Source: Company, MOSL
Source: Company, MOSL
16 November 2015
11

Page Industries
Innerwear opportunity is BIG; Page has a
right to win
The innerwear segment forms ~8% of the apparel industry, but is the fastest
growing piece. As per Industry estimates, the segment is expected to grow from
INR178b in 2013 to INR595b in 2023—a 13% CAGR, led by favourable
demographic and income factors as well as higher propensity of consumers to
use branded products.
We note, per capita spend on innerwear products in India is ~90% lower than
China and Thailand, per management. Thus, consumption-led growth potential
complements penetration and drives category growth. The ‘premium and
above’ sub-segment constitutes ~20% of the market, offering a sizable
premiumization-led growth opportunity. We believe Page has a clear ‘right to
win’, given its aspirational positioning (which imparts greater pricing power—
evidenced by consistent high single-digit to low double-digit growth in pricing),
wide portfolio and strong backend advantage.
Page has consistently improved its product mix by driving investments in
women’s innerwear and leisurewear segments; these segments have higher
average realization per unit and, thus, contribution of men’s innerwear has
reduced from ~60% in FY11 to ~50% in FY15.
Despite a strong record of growth over the last 20 years (35% CAGR over
FY1995-2015), Page has enough headroom to grow, in our view. Continued
premiumization, portfolio expansion in existing product segments (men’s and
women’s innerwear) and distribution expansion in existing markets as also entry
into new segments (kids wear) and markets (distribution reach 1/4th of Rupa)
can ensure multiple years of 20%+ revenue growth, in our view.
Exhibit 26: Innerwear market could post 13% CAGR over 2013-2023
Inner Wear Market size (INR b)
595
178
2013
2023
Source: Industry, Company, MOSL
16 November 2015
12

Page Industries
Segment-wise Analysis
Men’s innerwear (51% of Page revenues): Anchor segment
The men’s innerwear is an INR68.7b segment and posted a 10% CAGR over
FY10-FY15. Over the last few years, the share of organized players in the men’s
innerwear segment has expanded significantly—driven by a rise in income
levels, preference for branded products and rapid growth of organized retail.
Given the above shift and the fact that competitors are operating in the
economy segment, Page is in a sweet spot as it is positioned as an aspirational
brand available at an affordable price. The underlying strength of the brand is
noteworthy, given its ability to post double-digit volume growth during the last
five years despite taking steep price hikes even during macro slowdown.
We forecast sales CAGR of 19.7% over FY15-FY18 (men’s segment posted 25.5%
over FY12-FY15), led by modest market share expansion annually and improving
product mix (higher contribution of value added products, with average
realization increasing from INR105 in FY15 to INR126 by FY18E).
Exhibit 28: 45% of men’s innerwear market is unorganized
Economy
25
Exhibit 27: Men’s Innerwear segment expected to post 9%
CAGR over 2013-2018
Men's Wear (INR b)
155.4
103.3
68.7
Unorganized
45
Medium
20
Premium Super
8
Premium
2
Source: Industry, Company, MOSL
2013
2018E
2023E
Source: Industry, Company, MOSL
Exhibit 29: Jockey is positioned as an aspirational brand at
an affordable price
INR/piece
Euro (Rupa)
Macroman (Rupa)
Lux
Hanes (Arvind)
VIP Frenchie X (Maxwell)
Chromozome
US Polo (Arvind)
Calvin Klein
Jockey (Page)
Base Range
Pop Colour
USA Originals
119-189
179-250
250-300
Source: Company, MOSL
80-150
125-170
140-165
145-210
150-200
165-239
239-269
799-2699
Exhibit 30: Per capita spend in men’s innerwear is negligible
v/s the Asian peers
Source: Industry, Company, MOSL
16 November 2015
13

Page Industries
Exhibit 31: For Page, men’s innerwear segment posted
strong volume growth despite consistent price increases
Volume Growth (%)
Price Growth (%)
38.5
12.9
15.1
3.9
22.6
15.7
FY12
14.6
FY13
14.0
19.4
9.9
FY14
FY15
4.0
8.0
10.8
8.0
15.0
7.0
15.0
3.9
FY12
19.1
4.6
FY13
5.8
Exhibit 32: Men’s innerwear segment could post 19.7%
CAGR over FY15-FY18
Revenue (INR b)
33.2
25.3
7.7
Revenue Growth (%)
13.2
10.7
8.6
24.2
12.3
FY14
FY15 FY16E FY17E FY18E
Source: Company, MOSL
23.1
32.4
2.9
FY11
FY11
FY16E FY17E FY18E
Source: Company, MOSL
Women’s innerwear (18% of revenues): Positioned as a utility brand
The women’s innerwear segment is ~INR 108.8b and has posted 11% CAGR over
FY10-FY15. Unorganized players have witnessed a structural decline in market
share over the last few years—driven by rising number of working women,
increased purchasing power/frequency and increasing number of consumers
opting for hosiery innerwear with separate brands for different
purposes/occasions (functional, fashionable, fun and fantasy).
Page Industries forayed into women’s segment in 1997 with the brand “Jockey
For Her”. The company has incrementally focused on the women’s segment,
given its higher growth than men’s innerwear and better realization metrics. A
notable difference in Page’s strategy has been the focus on its basic product
range and emphasis on its positioning as an affordable premium/utility product
compared with its aspirational brand image in other segments.
With global lineage of Jockey International Inc. (provides a large sample space
for research and development and aids in product testing across geographies),
PAGE can introduce new offerings frequently. The company offers fitting
sessions at stores to increase adoption/repeat purchase of its existing/new
offerings.
We forecast 30.1% sales CAGR over FY15-FY18 (women’s segment posted 30.6%
CAGR over FY12-FY15), led by a shift from unorganized to organized segment,
increasing product reach and rising purchase frequency (higher discretionary
income translating into higher use/multiple brands, depending on the occasion).
Exhibit 34: The women’s innerwear market is largely
unorganized (%)
Economy
18
Unorganized
50
Exhibit 33: Women’s innerwear segment expected to
expand 4x over 2013-2023E
Women's Wear (INR b)
440.0
218.8
108.8
Medium
22
Premium Super
8
Premium
3
Source: Industry, Company, MOSL
14
2013
2018E
2023E
Source: Industry, Company, MOSL
16 November 2015

Page Industries
Exhibit 35: Jockey positioned as a utility brand with pricing
at a discount to global players
INR/piece
VIP
Lovable
Jockey
Enamor
Bwitch
Amante
Triumph
60-100
120-395
139-199
225-495
250-799
345-495
399-499
Source: Company, MOSL
Source: Industry, Company, MOSL
Exhibit 36: Per capita spend in women’s innerwear
miniscule compared with other Asian peers
Exhibit 37: Bra segment posted solid volume performance in
the recent period, aided by low base
Volume Growth (%)
7.7
10.9
0.2
39.8
43.9
28.3
30.0
30.0
25.0
10.6
10.0
8.0
Price Growth (%)
Exhibit 38: ..with bra revenues posting 48% CAGR over FY11-
FY15
Revenue (INR b)
49.5
52.8
40.2
59.6
41.9
43.0
40.4
35.0
Revenue Growth (%)
5.3
8.0
1.2
1.8
2.5
3.3
41.9
41.8
0.3
FY11
FY12
FY13
FY14
FY15
FY16E FY17E FY18E
Source: Company, MOSL
FY11
0.4
FY12
0.5
FY13
0.9
FY14
FY15 FY16E FY17E FY18E
Source: Company, MOSL
Exhibit 39: Women’s innerwear segment posted 14%
volume growth in FY15
Volume Growth (%)
Price Growth (%)
Exhibit 40: While revenues grew at 29% CAGR over FY11-
FY15
Revenue (INR b)
55.0
47.1
Revenue Growth (%)
17.1
25.7
24.8
11.1
24.2
21.8
5.1
14.7
(3.7)
FY14
13.7
7.0
10.0
8.0
14.0
8.0
14.0
0.5
FY11
0.8
FY12
35.3
19.5
10.4
1.1
FY13
1.2
FY14
1.5
17.7
1.7
23.1
23.1
2.1
2.6
FY11
FY12
FY13
FY15
FY16E FY17E FY18E
Source: Company, MOSL
FY15 FY16E FY17E FY18E
Source: Company, MOSL
16 November 2015
15

Page Industries
Leisurewear (29% of Revenues): Bridging the price-utility gap
The leisurewear segment is ~INR100b and has posted 14% CAGR over FY10-
FY15. The segment is a recent addition to Page’s foray into adjacent apparel
categories. The company currently has various product offerings under different
categories such as loungewear (capris, pyjamas, and boxers), casual wear (t-
shirts), sportswear (track pants, shorts, muscle tees, socks) and thermal wear.
Increasing health consciousness has made sports, gym, jogging, swimming, yoga,
etc. an essential part of modern life, especially in metros; as a result, the
demand for active wear is on the rise within the Indian menswear market. We
believe focus on sportswear in the segment results in better pricing power.
Leisurewear is a bigger segment than innerwear and thus offers good long-term
opportunity for Page to expand its product bouquet.
We forecast sales CAGR of 25.5% over FY15-FY18 (leisurewear segment posted
41.7% over FY12-FY15), led by rising use of branded apparel by customers,
ability of Page to leverage Jockey’s brand equity by foraying into new sub-
segments and increased product reach.
Exhibit 42: Leisurewear posted 42% CAGR in revenues over
FY11-FY15
Revenue (INR b)
67.4
64.5
44.7
36.2
Revenue Growth (%)
Exhibit 41: Strong volume-led performance in leisurewear
Volume Growth (%)
8.1
20.3
54.9
13.5
27.5
FY11
FY12
4.7
30.1
FY13
36.7
5.0
21.0
FY15
5.0
12.0
8.0
20.0
8.0
20.0
Price Growth (%)
27.1
3.6
FY14
4.5
29.6
17.6
5.3
6.9
29.6
1.1
FY11
1.6
FY12
2.2
FY13
8.9
FY14
FY16E FY17E FY18E
Source: Company, MOSL
FY15 FY16E FY17E FY18E
Source: Company, MOSL
Speedo: Additional growth catalyst
Page Industries has entered into an exclusive licensing agreement with Speedo
International for the manufacture and distribution of Speedo swimwear, water
shorts, apparel, equipment and footwear with effect from July 01, 2011. Though
swimming is still at a nascent stage in India, it is expected to evolve rapidly—
driven by increased fitness consciousness amongst the youth (as per a Nielsen
Survey, 3% of the urban audience in Sec A/B are penetration swimmers—swim
twice a week) and 24% are potential swimmers). Besides, swimming is
increasingly being preferred as a hobby and recreation activity due to rising
number of swimming pools. While the overall contribution from the segment
remains low (1.5% of revenues as of FY15), we believe it brings to fore the
management’s underlying strategy to leverage Page’s existing distribution
network to introduce international brands in India. We note after the initial
launch and finalizing the product offerings, PAGE is now focusing on expanding
the reach of Speedo—the brand is currently distributed through 986 stores in 74
cities and across 9 Speedo exclusive brand outlets (EBOs).
Page is also foraying into kids wear segment by tweaking its earlier product
offerings and launching a broad-based product range (increasing the width of
16
16 November 2015

Page Industries
offerings). Though the segment is not expected to contribute meaningfully to
revenues in the near term, the underlying characteristics of the category—a)
high repeat purchase, b) relative demand inelasticity (typically, pricing is not a
deterrent while shopping for kids) and c) limited competition (organized players
are focussed on kids apparels rather than kids innerwear segment)—remain
attractive.
Exhibit 43: Kids wear: Boys wear segment to turn ~3x over
2013-23E
Boys Wear (INR b)
672
Exhibit 44: …so will be the girls wear segment
Girls Wear (INR b)
672
414
258
240
402
2013
2018E
2023E
2013
2018E
2023E
Source: Industry, Company, MOSL
Source: Industry, Company, MOSL
Additionally, Page has exclusive license for Jockey products in Sri Lanka,
Republic of Maldives, Bangladesh, Nepal and UAE, however we do not factor
anything significant from these geographies in the medium term till Page
finalizes its product and distribution strategy.
16 November 2015
17

Page Industries
Insights from Ground ZERO
We interacted with several channel partners (EBO/MBO) to understand more about
the innerwear Industry. Following are the key insights:
Depth of product line:
A customer generally purchases innerwear in bulk; therefore,
keeping many SKUs of the entire product line is important.
Price inflation:
Barring the premium players, companies operating in the regular and
economy segments take ~7-8% price hike annually in the men and women’s
innerwear segment.
Inventory cover:
Inventory turn in innerwear is significantly higher than other
apparel categories.
Promotion spends:
The innerwear segment generally does not require promotions
as it’s a necessity product.
Customer switch:
In the Multi Brand Outlet (MBO) format, players operating in the
channel have their own sales staff. A salesperson assists in driving the trial of a new
offering and can provide incremental sales of up to 50% by upselling/cross selling
products.
Men’s Innerwear segment
~70% of men’s innerwear shopping is done by women; therefore, a product’s
color and display (pattern/style/design) are the key parameters for assisting in
shopping.
Customers’ pecking order of purchase depends on individual disposable income.
However, broadly speaking, comfort, brand and pricing (in that order) are the
key determinants. An average customer purchases four pieces of innerwear
during a year.
Jockey’s price point is affordable, but its positioning in customers’ mind is
PREMIUM.
Individuals
in the age group 18-30 are more experimental
(patterns/styles/colors) while individuals above this age group generally stick to
same brand, however uptrading is regularly seen. Jockey regularly introduces
new designs/product line to keep its offerings attuned to market tastes.
Premium brands such as Calvin Klein and Tommy are focused on quality. Calvin
Klein manufactures its products in Thailand and sources it in India. Sales person
plays a key role in initial trial of a premium offering and once a customer
purchases a premium variant, he generally does not trades down. In FY15,
Jockey launched
USA Originals
with trendy colors to compete against
international players, which has seen an encouraging response.
Denim brands such as UCB and US Polo have launched their innerwear brands
but customer repeat purchase for such products is lukewarm.
The men’s innerwear segment has a price point gap ranging from INR600 to
INR900.
Women’s innerwear segment
Value-wise category size split between top (bra) and bottom (panty) wear is in
the proportion of 65:35—given the fact that cost of top wear is higher than that
of bottom wear (average price of top wear is ~2x bottom wear).
16 November 2015
18

Page Industries
Women’s spending on lingerie is miniscule to their overall spending on other
discretionary/fashion products, namely shoes, clothing and bags.
Customer pecking order of purchase—quality/fit/comfort, occasion/dress
(sports, casual or party), followed by price—are the key determinants. Generally
a customer is focused on the longevity of product and not the price. An average
customers purchase 6-8 sets of Innerwear during a year.
Women use multiple innerwear brands across price points, depending on the
occasion (regular use/occasion-driven use).
Purchase decision is generally taken without interacting with the sales person.
However, several companies run fitting sessions to inform customers about the
right products, fit, etc. For instance, Triumph and Jockey occasionally run fitting
sessions to explain more about the products and offer free bag/lipstick/freebies
on purchase of products.
International brands frequently introduce new products (Triumph/Bwitch
introduces new design every three months while Enamor and Jockey launch new
design on a half yearly/annual basis).
Kids’ innerwear segment
There is no pan-India branded player in the kids’ innerwear segment. However,
international brands such as Tommy and Nautica are incrementally focusing on
kids apparel category and new-gen working parents are also looking to increase
spends toward branded kids wear.
Repeat purchase in the kids’ innerwear segment is higher than other innerwear
segments. An average customer purchases 10-12 sets of kids innerwear during a
year as kids have multiple usage requirements—school, play, etc.
There are few brands in the organized multi-brand channel format—
MotherCare (offering for 0-8 years; INR1,200 for 4 units of a boy’s
undergarment) and SHOP (offering for 2-14 years; INR500 for 5 units of a boy’s
undergarment). Jockey could introduce its product offering at INR200 and may
do well, given its existing connect with customers, as per channel partners.
Leisurewear segment
In pyjamas/capris/t-shirts, there are not many brands operating at Jockey’s price
point (except Hanes and VF in men’s segment and Jockey and Lovable in
women’s category). Other brands do not have the width and depth in the
product portfolio similar to Jockey, as per channel partners.
Sportswear brands such as Puma, Nike, Reebok and Adidas have a broader
offering (depth + width) but operate at ~2x Jockey’s price point. Jockey is used
as a nightwear brand but its USP is its availability at a price point that is at a
discount to the sportswear brands and quality superior to the unorganized
product. However, Jockey does not compete with certain products in the
sportswear category that have high recall—such as Nike sweat-resistant t-shirts.
Customers in the economy/mass segment use their nightwear products for
multiple occasions such as morning walks/gym.
16 November 2015
19

Page Industries
Significant room to expand distribution
Distribution and distribution servicing—key growth drivers
Page pioneered the concept
of display modules at stores
to enhance customer
involvement at the time of
purchase.
Page fixes MRP for all the
products and sells the
entire product line at same
MRP irrespective of the
location.
Page’s success is driven by aggressive expansion of its product reach and
effective servicing of channel partners. Page’s reach has expanded from 800
stores in 1996 to ~30,000 (added 10,000 stores in the last three years).
Page segments its distributors across regions and on the basis of product range.
As per our interaction with various channel partners, PAGE— given its brand
equity—offers lower channel margin than peers (25% v/s 30% at retail level);
this gets compensated by much higher throughput and superior distribution
servicing. Thus, a channel partner still gets higher absolute commission from
Page despite lower percentage channel margins.
A customer generally purchases innerwear in bulk; thus, availability of the
product (breadth and depth of product range) is integral to channel servicing.
We note that PAGE employs sales personnel at channel partner’s premises to
bring about smooth functioning of channel framework and effective
implementation of marketing and trade strategies. As per our discussion with
the management, Page is now rolling out several IT initiatives to improve
inventory management at the distributor level.
PAGE is incrementally focusing on expanding its EBO count (~9% of sales; store
count stands at 240), which we believe should aid in enhancing its image as a
lifestyle brand. Moreover, the EBO format carries the entire Jockey product
range (men, women and leisurewear)—unlike a typical hosiery store, which
stocks fast-moving SKUs. The EBO format also drives better brand visibility and
enhances customer experience.
Page is also focusing on expanding the Speedo brand and has increased its store
count reach by 50%. The brand is currently distributed through 986 stores in 74
cities and also across its 9 EBOs.
Exhibit 46: Doubled Jockey EBO count in the last two years,
aims to reach 300 EBOs by FY16
Store Count (beginning of the year)
Net Additions
47
Hoseiry, 45
39
29
71
FY13
100
FY14
54
240
139
4
67
FY12
Exhibit 45: PAGE derives significant revenue contribution
(%) from traditional channels
Large
Format
Stores, 6
EBO, 9
MBO, 40
11
32
FY09
Source: Company, MOSL
11
43
FY10
13
54
FY11
FY15 1HFY16
Source: Company, MOSL
Despite significantly increasing its presence, Page’s reach of 30,000 outlets is
only 25% of Rupa’s 118,000 stores as of FY14. Also, PAGE has launched its own
B2C e-commerce channel and tied up with leading online retailers to increase
the reach of its products.
16 November 2015
20

Page Industries
Exhibit 47: PAGE retail count at 25% of peers, significant room to expand
Retail Count Reach
550
1,000
Distributor Count
110,000
118,000
450
30,000
Maxwell
Rupa
Page
Source: Company, MOSL
Exhibit 48: Jockey launched its EBOs under the international
format to enhance customer experience
Exhibit 49: Jockey opened its first women’s store in FY11 to
display its complete line of women’s offerings
Source: Company, MOSL
Source: Company, MOSL
16 November 2015
21

Page Industries
‘Affordable yet aspirational’ positioning
Focus on 4F—Function, Fashion, Fun and Fantasy
Jockey communicates the inherent 4F requirement for an innerwear brand to its
target audience in a lucid format.
Jockey is positioned as an “affordable and comfort” brand in the innerwear
segment, though with an aspirational element. It had initiated the “Just
Jockeying” campaign during FY10-14 to transform itself into a lifestyle brand—
extending from being a strong men’s brand to a unisex and a leisurewear brand.
During FY15, it rechristened Jockey’s positioning with a new campaign, “Jockey
or Nothing”, enhancing its stature and brand leadership in consumers’ minds.
Page focuses on BTL activities and does in-store adverts and display signage to
increase brand visibility. However, it rarely—if ever—goes for above-the-line
promotions.
Exhibit 51: PAGE rolled out a new campaign in FY15—“Jockey
or Nothing”—to enhance its brand equity
Exhibit 50: Jockey initiated the Just Jockeying campaign in
FY10 to position itself as a lifestyle brand
Source: Company, MOSL
Source: Company, MOSL
Exhibit 52: Page spends ~4% on advertising; spends linked to campaign
(%)
Page Industries
Lovable Lingerie
Maxwell Industries
Rupa Industries
FY10
5.1
1.7
2.7
7.8
FY11
2.5
4.6
4.4
7.7
FY12
3.0
5.1
1.7
7.0
FY13
3.3
5.9
5.3
7.4
FY14
4.4
2.0
1.1
7.7
FY15
4.6
2.6
0.6
6.9
Source: Company, MOSL
Given its strong brand equity in consumers’ minds, Jockey ranks far ahead of
competitors in Brand Equity Survey conducted by Nielsen (refer to Exhibits 54
and 55). We note in the men’s innerwear segment, Jockey is the leading pan-
India brand with strong foothold in north and south India. In the women’s
innerwear segment, Jockey stands clearly ahead of other brands in the west and
south India.
16 November 2015
22

Page Industries
Exhibit 53: Jockey: Brand Philosophy
Source: Company, MOSL
Exhibit 54: Brand Equity Index—Jockey men’s innerwear on a strong footing relative to its peers
Source: Company, Nielsen, MOSL
Exhibit 55: Brand Equity Index—Strong positioning of Jockey women’s innerwear
Source: Company, Nielsen, MOSL
16 November 2015
23

Page Industries
Strong manufacturing set-up—an entry barrier for
competitors
Global lineage aids new product development
Integrated manufacturing set-up provides better control over quality
PAGE has its manufacturing set-up across eight adjacent factories at a single
location engaged in integrated garmenting processes—from cutting of the fabric
to packing of the finished product. While other players in the innerwear
segment procure their finished goods from third-party contractors, PAGE
develops its product in-house with better quality control.
However, it is dependent on external suppliers for certain raw material inputs—
especially fabric, which is the largest component in material costs. With swift
payment norms (payable days for Page are half of that for other companies in
the innerwear industry) and a sustained high growth rate, Page has established
strong relationships with its vendors.
Large employee base; difficult to replicate for competitors
Page has 18,717 employees across its factories, of which ~85% are women
(higher women count restrains labor unrest issues, which is not the case in a
male-dominated workforce). Given the paucity of quality labor, Page undertakes
several initiatives to keep the workforce motivated and trained. It introduced
“Page School of Learning” during FY15 wherein women workers from the shop-
floor are provided with in-house learning methodologies, which aid self-
development.
Given that majority of its labor force is women, Page provides crèche facilities to
employees wherein food and snacks (including milk) are provided free of cost.
Moreover, the company has set up health centres internally to provide for a
congenial work environment.
We note that under the existing contract with Jockey, inability of Page to carry
out production for 60 consecutive days could result in termination of the
agreement. However, Page is yet to witness any labor-related issue due to its
relentless focus on employee relations and development.
PAGE has also been certified by US-based WRAP (World Wide Responsible
Apparel Production) for adherence to the principles covering Labour & Human
Relations and applicable local laws pertaining to industrial production.
Jockey parentage aids innovation and NPD (New Product Development)
Jockey enjoys a strong parent lineage and with support of its 43 licensees, it gets
ready access to research and know-how; this drives innovation and new product
development. Page’s design team regularly takes inputs from global team on
fit/size/quality for new product offerings.
16 November 2015
24

Page Industries
Exhibit 56: Recent NPDs
Year
FY10
New Product Introduction
Women’s 24*7 stretch range - Capris, long pants, t-shirts
Comfort Stretch - Panties
Sports- Knit shorts, track pants, fashion/racer backs vests, muscle tees, slim polos and sports T-shirts
Sports Performance
FY11
Lace Essence - Bra (Fabric - stretch cotton) - Everyday wear
Signature Stretch - Panties, Bra range; coordinating colors
Zone Stretch - Boxer briefs
Comfort Plus - Trunk briefs
FY12
Fashion Stretch - Panties and Bras
Essence – Bras
24*7 relax - Boxer shorts for women
Kids - Jockey Kids - both boys and girls
FY13
No Panty Line Promise
Sports Performance Microfiber Seam free
International Collection - Modern Thermals
Pop Color - Premium Innerwear for young men
FY14
FY15
Jockey new Seamless Shape wear
Jockey USA Originals
International Collection for Women
Source: Company, MOSL
Exhibit 57: Page introduced Jockey USA Originals in FY15 to
compete with premium innerwear brands
Exhibit 58: Consistently introduced new products in women’s
innerwear
Source: Company, MOSL
Source: Company, MOSL
16 November 2015
25

Page Industries
Fastest growing consumer franchise with deep and wide
MOAT
Brand strength reflected in superior financials
Exhibit 59: PAGE posted industry-leading performance
during FY10-15 despite weak macros
Sales CAGR (%)
PAT CAGR (%) 35.0 37.7
22.2
14.7
4.3
(0.0)
Lovable
(0.0)
Maxwell
Rupa Industries
Page
FY11
FY12
FY13
FY14
FY15
13.3
Exhibit 60: Best-in-class RoEs amongst peers (%)
Lovable
Maxwell
Rupa Industries
Page
Source: Company, MOSL
Source: Company, MOSL
Exhibit 61: Better pricing power enables PAGE to enjoy
superior gross margins (%)
Lovable
Maxwell
Rupa Industries
Page
Exhibit 62: Consistent and upward trending EBITDA Margins
(%)
Lovable
Maxwell
Rupa Industries
Page
FY11
FY12
FY13
FY14
FY15
FY11
FY12
FY13
FY14
FY15
Source: Company, MOSL
Source: Company, MOSL
Exhibit 63: Page’s cash conversion cycle days are better than peers despite lower payable
days
Lovable
Maxwell
Rupa Industries
Page
FY11
FY12
FY13
FY14
FY15
Source: Company, MOSL
16 November 2015
26

Page Industries
Expect robust revenue CAGR of 23% over FY15-18:
We expect PAGE to post
23% revenue CAGR over FY15-18, driven by a) shift from unorganized to
organized players underpinned by favorable demographics and rising affluence;
b) increased product reach; and c) expansion of product portfolio. We expect
PAGE’s volume growth to revive with improvement in consumer discretionary
spends and model 14% volume CAGR over FY15-FY18.
EBITDA margin to be in the 20-22% band:
PAGE’s operating margins have
stayed in the 20-22% range, demonstrating its superior pricing power. We
believe benign input prices (cotton prices are down 9% QoQ and 17% YoY) and
mix improvement to be incrementally invested in higher brand spends, thereby
keeping EBITDA margins steady in the 20-22% band over FY15-FY18.
Exhibit 65: ..driven by broad-based growth (%) in various
sub-segments
FY10 - FY15
47.1
38.4
FY 15 - FY18
35.0
25.5
19.3 21.0
23.3
Exhibit 64: PAGE expected to post 23% revenue CAGR over
FY15-FY18..
Revenue (INR b)
44.6
40.0
25.7
35.6
Revenue Growth (%)
29.9
16.9
27.1
26.2
29.5
19.7
30.1
5.0
FY11
7.0
FY12
8.8
FY13
11.9
FY14
15.4
18.0
22.9
29.0
Mens
Womens Liesurewear
Others
Total
Revenues
FY15 FY16E FY17E FY18E
Source: Company, MOSL
Source: Company, MOSL
Exhibit 66: Sales growth to be primarily volume led
Volume Growth (%)
19.5
12.9
14.3
8.0
Price Growth (%)
Exhibit 67: EBITDA margins to remain in ~20-22% band
EBITDA Margin (%)
21.0
20.2
19.3
21.5
20.7
21.5
21.2
21.7
FY10 - FY15
FY 15 - FY18
Source: Company, MOSL
FY11
FY12
FY13
FY14
FY15 FY16E FY17E FY18E
Source: Company, MOSL
Exhibit 68: PAT expected to post 27% CAGR over FY15-FY18
PAT (INR b)
47.8
53.7
36.7
25.1
27.5
19.7
1.5
FY14
2.0
2.3
3.0
PAT growth (%)
Exhibit 69: Payout ratio (%) to remain steady
57.7
53.3
57.6
Dividens Payout (%)
29.6
31.1
4.0
50.9
48.9
50.0
50.0
50.0
0.6
FY11
0.9
FY12
1.1
FY13
FY15 FY16E FY17E FY18E
Source: Company, MOSL
FY11
FY12
FY13
FY14
FY15 FY16E FY17E FY18E
Source: Company, MOSL
27
16 November 2015

Page Industries
Capital efficient model; steady return ratios:
Our expectation of 27% PAT CAGR
and moderate capex requirement and stable working capital profile should
result in stable RoE of 45-50%. PAGE is looking to invest in automating its
distribution network, which could result in better availability of its product
offerings and gradual reduction in inventory days. The company’s healthy
balance sheet should strengthen further, providing it the flexibility to venture
into new segments or increase payout.
Exhibit 70: Improvement in net working capital days driven by better inventory
management, led by roll out of several IT initiatives
FY11
Debtor days
Inventory days
Payable days
Net Working Capital days
17
95
17
95
FY12
18
88
16
90
FY13
21
85
18
89
FY14
20
92
16
96
FY15
19
95
17
98
FY16E
18
94
17
95
FY17E
17
88
15
89
FY18E
17
87
15
89
Source: Company, MOSL
Exhibit 71: Best-in-class RoE (%)
FY11
Asset Turns (x)
Leverage (x)
Net Margin (%)
RoE
2.1
1.9
11.8
47.3
FY12
2.9
1.5
12.9
54.3
FY13
2.8
1.5
12.8
52.7
FY14
2.6
1.6
12.9
53.2
FY15
2.8
1.4
12.7
50.7
FY16E
2.8
1.3
13.0
46.5
FY17E
2.9
1.2
13.3
46.3
FY18E
2.9
1.1
13.8
46.6
Source: Company, MOSL
Exhibit 72: We expect net debt/EBITDA to be at 0.2-0.3x in the medium term
1.1
Net Debt/(Cash)/EBITDA
0.5
0.5
0.6
0.5
0.3
0.2
0.2
FY11
FY12
FY13
FY14
FY15
FY16E
FY17E
FY18E
Source: Company, MOSL
16 November 2015
28

Page Industries
Valuation and view: Earnings visibility to support premium valuations; initiate
with a BUY:
Page offers a compelling, capital-efficient long-term lifestyle play on
premiumizing innerwear category. Four-fifths of the innerwear category is still
sub-premium and provides a decent runway for premiumization-led growth. We
believe widening product and brand portfolio, coupled with distribution
expansion will aid share expansion and drive multiple years of growth. We
initiate coverage with a BUY Rating and target price of INR14,500 (41x FY18E
EPS—three year average P/E). Given the strong earnings visibility, steady return
ratios and lack of credible/relevant competitor in the premium space, we expect
the premium valuations to sustain. We believe the stock offers healthy long-
term returns potential; we expect 21% CAGR over three years and 22% CAGR
over eight years. Heightened competitive intensity from international brands
and potential labor issues (has ~18k employees on rolls) are key risks.
Exhibit 73: Page P/E
82
62
42
22
2
33.4
26.0
46.1
P/E (x)
5 Yrs Avg(x)
9 Yrs Avg(x)
Exhibit 74: Page’s P/E premium v/s Sensex
350.0
270.0
190.0
110.0
30.0
-50.0
Page Inds. PE Relative to Sensex PE (%)
Avg(x)
Source: BSE, Company, MOSL
Source: BSE, Company, MOSL
16 November 2015
29

Page Industries
Long-term construct: Page can be a multi-year
compounder
Market shares can double in five years; 20% CAGR stock returns in three
years
One of the key reasons Page trades at premium valuations is the potential for
multiple years of attractive growth. Thus, even though the near-term valuations
are expensive and provide limited upside, we believe returns over 3/5/10 years
can be healthy. Moat created by Page over the last 20 years will stand it in good
stead for many years to come, in our view. In our recent interactions, Mr.
Genomal sounded confident of delivering growth rates achieved in the last five
years for another five years at least.
Big opportunity in innerwear, Page’s early-mover advantage and
right to win,
coupled with lack of credible and relevant competition in the premium space
(international brands lack scale while domestic brands with scale do not have
presence in the premium space) should ensure sustenance of premium
valuations, in our view. The key difference with respect to other consumer
franchises in our universe is: a) Lower penetration for branded innerwear
apparels, b) pricing power on account of niche positioning and c) benign
competitive environment.
In the section below, we discuss the long-term growth rates for Page in its key
segments. Our long-term assumptions are predicated on continued shift toward
organized players, improvement in the macroeconomic scenario, demographic
factors playing out over the next decade (urbanization, rising incomes, rising
proportion of working women, greater fashion awareness) and Page continuing
to gain modest market share annually through portfolio and distribution
expansion.
Men’s innerwear:
The men’s innerwear segment grew at 10% CAGR over FY10-
FY15. We expect this trend to continue with organized market posting a higher
12% growth, within which Page’s target segment (mid-premium and premium)
posting a 15% CAGR. We expect Page’s volume to continue to grow in the 13-
15% band while pricing growth is baked in at 6-8%. Consequently, we expect
Page’s market share to expand from the existing 9.2% to 14.7% by FY20.
Women’s innerwear:
The women’s innerwear category is growing faster than
the men’s segment and we expect this trend to continue. We expect the
category to grow at 14%, with organized segment posting 17% CAGR over FY15-
20. We model 20% growth for the company’s target segment owing to
premiumization, and expect Page’s women’s innerwear volume CAGR of 18-20%
and pricing CAGR of 6-8% over FY15-20. Consequently, Page’s market share can
expand from the existing 2.3% to 4.2% by FY20.
Overall, we expect Page’s combined market share (men’s and women’s
innerwear) to expand from 5.1% in FY15 to 8% in FY20. Thus, 25-30% topline
CAGR in Page is still possible despite the high base of 35% CAGR over FY10-15.
Assuming modest margin gains and operating margins in the 21-22% band, we
believe similar profit CAGR is attainable. In our view, Page is still a 20%+ CAGR
story on a long-term basis. In the next section we discuss the potential long-
term investment returns.
16 November 2015
30

Page Industries
Exhibit 75: Page’s growth to be driven by market share gains in an expanding category
INR b
INNERWEAR MARKET (Organized + Unorganized)
Market Size
YoY growth (%) in this market
Page - Mens & Womens Innerwear Sales
YoY growth (%)
Page Market Share (%)
MENS INNERWEAR CATEGORY
Market Size
YoY growth (%) in this market
Organised Market Size
YoY growth (%) in this market
Page Target Market
YoY growth (%) in this market
Page - Mens Innerwear Sales
YoY growth (%)
Page Market Share (%)
WOMENS INNERWEAR CATEGORY
Market Size
YoY growth (%) in this market
Organised Market Size
YoY growth (%) in this market
Page Target Market
YoY growth (%) in this market
Page - Womens Innerwear Sales
YoY growth (%)
Page Market Share (%)
2.0
7.7
4.4
FY14
180
7.9
FY15
202
12.3
10.4
31.4
5.1
FY16E
227
12.3
12.1
17.8
5.3
FY17E
255
12.4
15.3
26.4
6.0
FY18E
287
12.4
19.1
25.0
6.7
FY19E
323
12.4
23.6
23.4
7.3
FY20E
363
12.5
29.2
23.5
8.0
76
42
30
5.8
83
10.0
47
12.0
35
15.0
7.7
32.4
9.2
91
10.0
52
12.0
40
15.0
8.6
12.3
9.4
101
10.0
58
12.0
46
15.0
10.7
24.2
10.7
111
10.0
65
12.0
53
15.0
13.2
23.1
11.9
122
10.0
73
12.0
61
15.0
16.1
22.0
13.2
134
10.0
82
12.0
70
15.0
19.6
22.0
14.7
104
52
42
2.1
119
14.0
61
17.0
50
20.0
2.7
28.7
2.3
136
14.0
71
17.0
60
20.0
3.5
29.2
2.6
155
14.0
84
17.0
73
20.0
4.6
31.8
3.0
176
14.0
98
17.0
87
20.0
6.0
29.5
201
14.0
114
17.0
105
20.0
7.5
26.7
229
14.0
134
17.0
125
20.0
9.6
26.8
3.4
3.8
4.2
Source: Industry, Company, MOSL
Multi-year 20% CAGR returns achievable
As discussed in earlier sections, Page can deliver ~25% sales and PAT CAGR
over FY15-20E. Though lower than the 35% CAGR achieved in FY10-15, we
believe it is still robust.
Even after assuming a 20% de-rating from current P/E multiples, Page can still
deliver ~20% CAGR returns over the next three years. In our workings we
assign a P/E multiple of 35x, a 20% de-rating over the current P/E of 43x FY17E.
Valuing FY20E EPS (Sep’19) at 35x, we arrive at 21% return CAGR over the next
three years in Sep’18.
Similarly, forecasting for FY25, we arrive at 22% stock returns over the next
eight years. Post FY20, we build in lower topline CAGR of 25% over FY20-25
(base effect) and 80bp operating margin expansion to 22% (premiumization
and operating leverage) by FY25. We assume another 15% de-rating in target
P/E—from 35x to 30x over FY20-25.
16 November 2015
31

Page Industries
Exhibit 76: Page offers multi-year return potential despite rich valuations
PAGE (INR b)
Sales
Sales CAGR from FY15 (%)
EBITDA
EBITDA Margin (%)
EBITDA CAGR from FY15 (%)
PAT
PAT Margin
PAT CAGR from FY15 (%)
Long term potential stock return
Potential Market Cap (INR b)
Current Market Cap (INR b)
CAGR Return (%)
2015
15.4
3.2
20.7
2.0
12.7
2020E
57.3
30.0
12.1
21.2
30.6
7.6
13.2
31.0
2025E
174.8
27.5
38.4
22.0
28.3
24.5
14.0
28.7
265
136
21%
735
136
22%
Source: MOSL
16 November 2015
32

Page Industries
Management details and shareholding pattern
Exhibit 77: Details of senior management team
Name of Person
Mr. Sunder Genomal
Mr. Shamir Genomal
Mr. Pius Thomas
Role
Managing Director
Background
i. More than three decades of experience in various
facets of the textile industry
Remuneration
% of
(INR m)
Shareholding
12.0
6.6
11.2
17.0
-
-
Mr. Vedji Ticku
Executive Director-
i. Eight years of experience in various facets of textile industry
Chief Strategy Officer
Executive Director - i. More than three decades of experience in finance, accounts,
Finance
costing ,taxation purchase
ii. Previously worked with Electronic Research Limited and
Tata Oil Mills
Chief Operating
i. More than two decarde of experience in various facets of
Officer
textile industry
ii. Previously worked with Eureka Forbes Ltd
Manufacturing &
Operations
Sales & Marketing
23.1
NA
Mr. V S Ganesh
Mr. M C Cariappa
i. 25 years of experience working in various industries
i. 19 years of experience in the domain of Sales & Marketing
ii. Previously worked with Coca Cola, ITC and Brooke Bond Lipton
i. 21 years’ experience in designing and development of
intimate apparel
ii. Previously worked with Noi Soultions, Timex Garments,
Comfortwear and Intimark Mexico
7.4
9.2
NA
NA
Mrs. Shelagh Margaret Head – Product
Commons
Development
9.7
NA
Source: Company, MOSL
Exhibit 78: Details of Board of Directors
Name of Director
Mr. Pradeep Jaipuria
Mr. Sunder Genomal
Mr. Nari Genomal
Mr. Ramesh Genomal
Mr. Shamir Genomal
Mr. Pius Thomas
Mr. G P Albal
Mr. B C Prabhakar
Mrs. Rukmani Menon
Mr. V Sivadas
Mr. P V Menon
Position
Chairman
Managing Director - Promoter
Non-Executive Director - Promoter
Non-Executive Director - Promoter
Executive Director –
Chief Strategy Officer - Promoter
Executive Director - Finance
Independent Director
Independent Director
Independent Director
Alternate Director
Director
# Directorship in
Other Co’s
1
0
0
0
0
0
1
0
1
0
0
0
# Shares
Nil
1,895,646
1,896,503
1,895,920
200
171
-
-
-
-
78
-
% of Total
-
17.0
17.0
17.0
-
-
-
-
-
-
-
-
th
% of Board Meeting
Attended
2/4
4/4
NA
NA
3/4
4/4
4/4
3/4
3/4
2/4
4/4
4/4
Mr. Timothy Ralph Wheeler Director
Note: PAGE has added Mr Sandeep Kumar Maini and Mr Vikram Gamanlal Shah as Independent Directors from 28 May 2015
Source: Company, MOSL
Exhibit 79: Shareholding Pattern (%)
(%)
Promoter
FII
DII
Others
Mar'11
60.4
13.53
20.46
5.6
Mar'12
59.5
15.8
18.6
6.1
Mar'13
57.5
19.2
15.7
7.7
Mar'14
51.8
32.58
7.5
8.1
Mar'15
51.0
32.3
6.5
10.2
Sept'15
51.0
33.7
5.2
10.1
Source: Company, MOSL
16 November 2015
33

Page Industries
Financials and Valuations
Income Statement (INR Million)
Y/E March
Net Sales
Change (%)
Total Expenditure
EBITDA
Change (%)
Margin (%)
Depreciation
Int. and Fin. Ch.
Other Inc.- Rec.
PBT
Change (%)
Tax
Tax Rate (%)
Adjusted PAT
Change (%)
Reported PAT
2011
4,977
44.6
4,016
960
40.0
19.3
98
48
63
878
50.0
292
33.3
585
47.8
585
2012
6,966
40.0
5,504
1,462
52.2
21.0
106
67
52
1,341
52.8
441
32.9
900
53.7
900
2013
8,758
25.7
6,992
1,766
20.8
20.2
114
80
85
1,657
23.6
531
32.1
1,125
25.1
1,125
2014
11,877
35.6
9,326
2,551
44.5
21.5
139
142
65
2,335
40.9
797
34.1
1,538
36.7
1,538
2015
15,430
29.9
12,240
3,190
25.1
20.7
176
167
86
2,933
25.6
973
33.2
1,960
27.5
1,960
2016E
18,044
16.9
14,171
3,873
21.4
21.5
212
163
90
3,588
22.3
1,241
34.6
2,346
19.7
2,346
2017E
22,940
27.1
18,079
4,861
25.5
21.2
250
148
115
4,578
27.6
1,538
33.6
3,040
29.6
3,040
2018E
28,955
26.2
22,669
6,286
29.3
21.7
299
132
145
5,999
31.1
2,016
33.6
3,984
31.1
3,984
Balance Sheet
Y/E March
Share Capital
Reserves
Net Worth
Loans
Capital Employed
Gross Block
Less: Accum. Depn.
Net Fixed Assets
Capital WIP
Investments
Curr. Assets, L&A
Inventory
Account Receivables
Cash and Bank Balance
Others
Curr. Liab. and Prov.
Account Payables
Other Liabilities
Provisions
Net Curr. Assets
Def. Tax Liability
Appl. of Funds
2011
112
1,126
1,238
1,150
2,388
1,259
328
931
102
30
2,327
1,647
258
26
395
976
251
78
646
1,351
26
2,388
2012
112
1,546
1,658
759
2,417
1,504
428
1,076
165
18
2,457
1,726
437
31
263
1,263
373
155
734
1,194
36
2,417
2013
112
2,024
2,135
1,007
3,142
1,860
538
1,322
138
10
3,248
2,350
581
46
271
1,518
473
216
830
1,730
57
3,142
2014
112
2,778
2,890
1,632
4,522
2,404
676
1,728
36
0
5,092
3,626
727
35
705
2,239
586
423
1,230
2,853
95
4,522
2015
112
3,756
3,868
1,573
5,440
3,059
886
2,173
1
0
6,061
4,435
884
44
698
2,680
821
504
1,355
3,381
114
5,440
2016E
112
4,929
5,041
1,473
6,514
3,795
1,098
2,697
1
0
6,943
4,845
939
315
845
3,014
840
544
1,629
3,930
114
6,514
2017E
112
6,449
6,561
1,373
7,933
4,414
1,349
3,065
1
0
8,813
6,159
1,194
403
1,057
3,831
1,068
691
2,071
4,982
114
7,933
(INR Million)
2018E
112
8,441
8,552
1,273
9,825
5,718
1,648
4,071
1
0
10,703
7,616
1,507
264
1,317
4,836
1,349
873
2,614
5,868
114
9,825
16 November 2015
34

Page Industries
Financials and Valuations
Ratios
Y/E March
Basic (INR)
EPS
Cash EPS
BV/Share
DPS
Payout (%)
Valuation (x)
P/E
Cash P/E
EV/Sales
EV/EBITDA
P/BV
Dividend Yield (%)
Return Ratios (%)
Asset Turn
Leverage
Net Margin
RoE
RoCE
RoIC
Working Capital Ratios
Asset Turnover (x)
Debtor Days
Creditor Days
Inventory Days
Leverage Ratio
Debt/Equity (x)
2011
52.5
61.3
111.0
26.0
57.7
2012
80.7
90.2
148.6
37.0
53.3
2013
100.9
111.1
191.4
50.0
57.6
2014
137.9
150.4
259.1
60.0
50.9
2015
175.7
191.6
346.8
72.0
48.9
2016E
210.4
229.4
451.9
89.9
50.0
2017E
272.5
295.0
588.2
116.5
50.0
2018E
357.1
383.9
766.8
152.6
50.0
249.1
213.3
29.5
153.0
117.8
0.2
162.1
144.9
21.0
100.2
88.0
0.3
129.6
117.7
16.8
83.1
68.3
0.4
94.8
86.9
12.4
57.8
50.5
0.5
74.4
68.2
9.5
46.2
37.7
0.6
57.8
53.0
7.6
35.3
26.9
0.7
44.6
41.2
6.0
28.1
20.7
1.0
34.0
31.7
4.7
21.7
15.9
1.3
2.1
1.9
11.8
47.3
31.4
31.0
2.9
1.5
12.9
54.3
39.3
40.5
2.8
1.5
12.8
52.7
42.4
42.8
2.6
1.6
12.9
53.2
42.6
42.1
2.8
1.4
12.7
50.7
41.6
40.1
2.8
1.3
13.0
46.5
41.0
40.5
2.9
1.2
13.3
46.3
43.4
43.9
2.9
1.1
13.8
46.6
45.9
45.9
2.9
17
17
95
0.5
3.2
18
16
88
0.5
3.1
21
18
85
0.6
3.1
20
16
92
0.4
3.1
19
17
95
0.3
3.2
18
17
94
0.2
3.3
17
15
88
0.1
3.3
17
15
87
0.1
Cash Flow Statement
Y/E March
Profit before Tax
Depreciation
Other Non Cash & Non oper. activities
Incr in WC
Direct Taxes Paid
CF from Operations
Incr in FA
Free Cash Flow
Pur of Investments
CF from Invest.
Incr in Debt
Dividend Paid
Others
CF from Fin. Activity
Incr/Decr of Cash
Add: Opening Balance
Closing Balance
2011
878
98
40
-720
-298
-2
-281
-283
9
-273
603
-286
-46
271
-4
30
26
2012
1,341
106
59
147
-427
1,226
-271
955
18
-253
-503
-402
-63
-968
5
26
31
2013
1,657
114
74
-457
-516
871
-435
436
16
-419
238
-596
-80
-438
14
31
46
2014
2,335
139
122
-1,098
-750
747
-511
237
22
-489
625
-756
-139
-270
-11
46
34
2015
2,933
176
96
-569
-966
1,670
-534
1,136
2
-531
-59
-899
-171
-1,129
9
34
43
2016E
3,588
212
73
-278
-1,241
2,353
-737
1,616
90
-647
-100
-1,173
-162
-1,435
271
43
315
2017E
4,578
250
33
-964
-1,538
2,359
-618
1,741
115
-503
-100
-1,520
-147
-1,767
89
314
403
(INR Million)
2018E
5,999
299
-12
-1,025
-2,016
3,245
-1,305
1,940
145
-1,160
-100
-1,992
-131
-2,223
-138
402
264
16 November 2015
35

REPORT GALLERY
RECENT INITIATING COVERAGE REPORTS

Page Industries
NOTES
16 November 2015
37

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