KPRMILL

KPR Mills’ (KPR’s) Q4FY25 numbers were soft with revenue growing just 4% y-o-y, while a 94 bps y-o-y decline in EBITDA margin and a higher tax rate dragged PAT by 4% y-o-y. A rise in garment and sugar volumes (up 8% and 11% y-o-y, respectively) was partially offset by a decline in textile realisation (garment/fabric & yarn realisation down by 1.8% and 1% y-o-y, respectively). Margins were impacted by a sharp decline in sugar business’ profitability. Given its significant exposure to Europe (58% revenue contribution in FY25), KPR is likely to be one of the beneficiaries of the recently-concluded FTA between India and the UK. Further, tariff elimination will improve KPR’s export competitiveness compared to Bangladesh and ***** stock has corrected by 18% since its recent high and trades at 36x/30x its FY26E/FY27E EPS and 24x/20x its FY26E/FY27E EV/EBITDA, respectively. We retain Buy with a revised PT of Rs. 1,287.