Notes 📋from Edelweiss Reasearch Sector Report on HOME DECOR🧵
~Covid-19 has accelerated the growth of home décor industry by offering enormous growth opportunities—import substitution, increasing exports and focus on home improvement in the wake of WFH.
@nid_rockz
~Covid-19 has accelerated the growth of home décor industry by offering enormous growth opportunities—import substitution, increasing exports and focus on home improvement in the wake of WFH.
@nid_rockz
Home Decor:
~Even at most conservative estimates, industry is likely to clock a 12– 14% revenue CAGR over FY21–26 (versus 5–6% CAGR over FY16–21).
~Traction in the wood panel industry is apparent from numbers: EPS CAGR of 42% over FY21–24E versus a 32% CAGR for ceramic tiles
~Even at most conservative estimates, industry is likely to clock a 12– 14% revenue CAGR over FY21–26 (versus 5–6% CAGR over FY16–21).
~Traction in the wood panel industry is apparent from numbers: EPS CAGR of 42% over FY21–24E versus a 32% CAGR for ceramic tiles
Strong Demand in Real estate:
The share of top developers in launches (6–26% across cities in CY11) surged to 28–78% in H1CY21.
The share of top developers in launches (6–26% across cities in CY11) surged to 28–78% in H1CY21.
Growth Drivers:
Structural Shifts in Home Decor:
~Industry transforming from a commodity to household brand
~Intensified focus on making products available too
~Product launches driving shift towards organised players
~Consolidation in real estate segment too is driving growth for brands
~Industry transforming from a commodity to household brand
~Intensified focus on making products available too
~Product launches driving shift towards organised players
~Consolidation in real estate segment too is driving growth for brands
Wood Panel Segment: Mid-end plywood segment driving growth
~MDF threatening low-end segment; mid end segment still growing
~Dominating share of unorganised players: A big opportunity for shift
~MDF:Fastest-growing category in wood panel industry
~MDF threatening low-end segment; mid end segment still growing
~Dominating share of unorganised players: A big opportunity for shift
~MDF:Fastest-growing category in wood panel industry
Innoation is they KEY:
New product launches by leading players.
New product launches by leading players.
Focus on Asset light model:
~Players in the plywood space are outsourcing the work pertaining to their medium/low-end brands such as Ecotech, Sainik, Jansathi and Bharosa.
~Players in the plywood space are outsourcing the work pertaining to their medium/low-end brands such as Ecotech, Sainik, Jansathi and Bharosa.
Outlook and valuation: Primed for re-rating
~The home décor industry at INR1tn as on FY21 is expected to double by FY26.
~We believe it is an emerging sector in India’s consumption story with a promising growth opportunity (12–14% CAGR) over the next 8–10 years
~The home décor industry at INR1tn as on FY21 is expected to double by FY26.
~We believe it is an emerging sector in India’s consumption story with a promising growth opportunity (12–14% CAGR) over the next 8–10 years
Earnings growth to drive re-rating
Diversification is the game:
Wood panel players entering into interesting growth phase
Wood panel players entering into interesting growth phase
Key Risks:
1. Covid 19
2. Economy connection: The consumption trajectory of home décor sector are intrinsically linked to realty sector and economic growth of the country.
3. unorganised players
1. Covid 19
2. Economy connection: The consumption trajectory of home décor sector are intrinsically linked to realty sector and economic growth of the country.
3. unorganised players
Finally a sectoral snapshot:
Which is your pick?
Greenpanel, Century, Greenlam look interesting to me.
Like RT if its helpful.
Which is your pick?
Greenpanel, Century, Greenlam look interesting to me.
Like RT if its helpful.
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