Tale of the Tape 

Hiya everyone. Welcome back to the Daily Rip!

Nifty (+0.2%) closed in the green for a RECORD 13th straight session! Midcaps (-0.2%) and Smallcaps (-0.3%) traded mixed. The advance-decline ratio was evenly split.

Most sectors ended in the red. FMCG (+0.8%) and IT (+0.4%) were the top gainers. Metals (-1%), Pharma (-1%) and Auto (-0.4%) saw the most selling pressure.

The wedding season is going to kick off soon. Read our top story below on which apparel companies you should be looking at to place your bets.

Gujarat Gas (+11%) soared after its mega merger plans were announced. More details below on the deal’s fineprint.

August auto sales were weak, with Maruti and Tata Motors seeing a dip. Meanwhile, Gala Precision Engineering IPO kicked off today. Check out the deets below.

Bajaj Finance (+3%) was in focus after announcing the IPO date of its housing finance arm.

Dixon Technologies cracked -4% after its management said FY25 growth would be slow due to its expansion plans.

Dr Reddy's Laboratories (-2%) fell after Chinese authorities suspended the import & sale of its key ADHD drug.

SJVN, Railtel and NHPC all rallied +5% intraday after the GOI upgraded  them to ‘Navratna’ status.

Indian Hume Pipe Company (+4%) gained after bagging a Rs 859 cr order for a Mahrashtra irrigation project. PS - the contract is worth nearly one-third of its market cap!

Rossell India rallied +10% intraday after the demerger of its aerospace & defence biz finally came into effect.

MOIL slumped -4% after it said it would cut manganese ore prices by up to 20% for September.

Here are the closing prints:

Sector
Taiyaar Hokar Aaiye! 🕺 

India’s wedding season is just around the corner. Fun fact - roughly $130 billion is spent over a 5-month period, which is INSANE. This has huge ripple effects across sectors, but one industry that gets particularly juiced up is apparel. Of the $84-billion apparel retail market, ~11% comes from wedding & celebration wear alone. On top of this, margins are mouth-watering in this segment AND Tier-2 and Tier-3 cities are increasingly shifting towards branded apparel.

To understand how best to play this theme, here’s a look at the industry landscape: 

1) Raymond Lifestyle: The company is the largest player in the organized men’s wear wedding market, with ~40% of its topline coming from marriages alone! To capitalise on upcoming demand, Raymond plans on expanding its ethnic store network from 114 stores in FY24 to 300+ by FY27. Motilal Oswal says its ‘Ethnix’ store revenue potential is Rs 1,000 cr over the next three years! Yes, we know the stock isn’t listed just yet, but chairman Gautam Singhania says it will next week after its recent demerger.

2) Vedant Fashions: The overall market leader in the ‘Indian celebration wear’ segment, the company’s revenue has grown at a CAGR of 15% over the last decade. It has the first-mover advantage, having launched ‘Manyavar’ way back in 1999. It is also the only listed pure-play wedding & celebration player right now. Fun fact: its margins are a LOT higher than every other listed retailer, coming in at 41% in FY23 vs 13% for Trent. Finally, unlike Raymond, it also caters to women with its Mohey brand.

3) Aditya Birla & Arvind Fashion: The other two players are on opposite sides of the spectrum. Aditya Birla Fashion has a huge range of ethnic wear lines, mostly acquired through buyouts. Crucially, it has a leader position in the luxury segment, where outfits sell for Rs 5 lakh a pop, through its Sabyasachi line. Arvind Fashion sits more in the mid segment and caters to only men and is best seen as a competitor to Raymond.

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