23 June 2017
Interaction with the CEO
Strong barriers to entry offer high growth opportunities
Among the elite, affluent and aspirers category of customers, PAGE’s men's
innerwear products account for only 18.5% of the potential market, while its
women's innerwear products command an even lesser share of 6-7%. Athleisure
(referred by the company as its sports and leisurewear products) has ~6% share,
while socks too has about similar share of the potential market. This indicates that
that the opportunity for growth is immense even without getting into the mass
There is also potential for cross-selling – Jockey men’s innerwear customer base can be
leveraged to grow the athleisure and socks (6% share each) segments.
Mr Vedji Ticku —
Chief Executive Officer
Mr. Vedji Ticku, B.E. (Mech),
Among the elite, affluent and aspirers category of customers, PAGE’s men's innerwear
has been Chief Executive
products account for only 18.5% of the potential market, while its women's innerwear
Officer of Page Industries
products command an even lesser share of 6-7%. Athleisure (referred by the company as its
Limited (PAGE) since
sports and leisurewear products) has ~6% share, while socks too has about similar share of
February 2016 and
Executive Director since
the potential market.
May 2017. He has been with
The company plans to ramp-up its production capacity at a CAGR of 17% over the next
PAGE since May 1997, and
has also served as its Chief
A strong focus on Exclusive Brand Outlets (EBOs) and Jockey Comfort Zones is the key driver
Operating Officer, General
of incremental sales growth.
Manager of Sales &
Strong brand equity of ‘Jockey’, a wide and increasing distribution reach, commendable
Marketing and General
Manager of Sales. Mr Ticku
design ability and a robust manufacturing setup are its key advantages.
joined the company as
Regional Sales Manager for
There is no change to our forecasts. We maintain Buy with a revised target price of INR19,125
the south zone. After
(target multiple maintained at 45x June 2019E EPS, at a 15% discount to three-year average
setting up the business
P/E). Unlike retail peers, PAGE has exhibited the ability to maintain strong double-digit volumes
successfully there, he was
growth and high RoEs, justifying high valuations. We believe PAGE is a compelling, capital-
promoted to Senior Sales
efficient, long-term lifestyle play on the premiumizing innerwear category. A widening product
Manager in 2001, with
additional charge of the
and brand portfolio, coupled with distribution expansion, will aid its market share and drive
north zone. Mr Ticku has
multiple years of growth, in our view.
more than 25 years of
experience in the fields of
sales, marketing, general
Jockey is the pioneer in establishing the premium segment innerwear category in
India. Its focus remains on the category above the mass level (i.e., elite, affluent and
corporate affairs. He has
previously worked with
aspiring customers). However, the brand’s market share in this target segment
Eureka Forbes Limited.
remains small, despite exhibiting rapid growth post its entry in the country.
What does PAGE do differently?
Macro factors driving growth for the company are: (i) higher disposable income, (ii) strong brand affinity in the buying
group (ages between 15 and 34), (iii) urbanization and (iv) strong appeal for Jockey.
Strong design ability at local level and design expertise of Jockey Inc. are the key advantages. Barring the US and
parts of Western Europe, Jockey operates via a master franchisee route in other markets. The company has a
team of 43 people designing premium products and focusing on new categories.
PAGE’s extensive manufacturing facility with 17 factories and 20,000 employees is another key advantage. Hand
stitching also brings in the skill factor into play.
(Krishnan.Sambamoorthy@motilaloswal.com); +91 22 6129 1545
(Vishal.Punmiya@motilaloswal.com); +91 22 6129 1547
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