Emkay Global Initiates Coverage on Metro Brands with a Buy Rating and Target Price of Rs 1250

Metro Brands Sees Improved Growth Trajectory, Maintains Positive Stance

Emkay Global Financial's research report on Metro Brands highlights a significant improvement in the company's growth trajectory, with an EBITDA growth of approximately 20% in Q4. This growth can be attributed to healthy demand during the festive/wedding season and the reduction in Goods and Services Tax (GST) on footwear priced below Rs2,500. As a result, Metro Brands does not expect any significant deviation in its near-term growth or margin profile.

The company's store expansion momentum has picked up, with 124 net additions in FY26, a notable increase from the 72 additions in FY25. This growth is expected to continue, driven by strong mid-teen growth prospects. The company's growth prospects are bolstered by the expansion of its existing portfolio, including Metro, Mochi, Walkway, and Crocs, as well as new scalable exclusive partnerships with Foot Locker, FILA, and Clarks. Additionally, Metro's positioning as a preferred partner for incoming global brands provides optionality, backed by a healthy balance sheet with approximately 40% cash at FY26-end.

Maintaining BUY Recommendation with Increased Target Price

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Emkay Global Financial maintains a BUY recommendation on Metro Brands, while increasing the target price by approximately 6% to Rs1,250 (57x Mar-28E EPS) from Rs1,175. This increase is largely earnings-led, driven by a ~4% revenue-led EBITDA beat in Q4 and better commentary on margin protection, which aligns with the company's cautious stance.