PC Jeweller Initiating Coverage Research Report By Emkay

We expect PCJ’s reduced focus on low margin export segment and increased investments & efforts on domestic business to pay off with domestic segment growing at 20% over FY15- 18E. Subsequently, we expect strong profitability, higher free cash flow and better return ratios. We have valued PCJ on SOTP basis assigning P/E FY17E multiples of 16x to the domestic business (40% discount to Titan) and 5x to its exports business (in line with peers), our target price works out to 490/share. We initiate coverage on PCJ with a BUY rating.

PC Jeweller Initiating Coverage