SD Retail is in the business of designing, manufacturing, outsourcing, marketing, and retailing sleepwear under the brand name ‘SWEET DREAMS’. SWEET DREAMS is a sleepwear-focused company offering a wide portfolio of stylish and comfortable sleepwear for the entire family, celebrating the transition from work to home life and catering to every aspect of downtime. The combination of comfort, style, and functionality places SWEET DREAMS in a unique position within a habit-forming apparel category, where its clothes are worn daily by its customers in similar time-ranges.
This brand is targeted primarily at the modern Indian woman’s sleepwear requirements since she is most engaged with this category across various retail channels. In addition, it also sells sleepwear for men and kids, whose casual clothes are predominantly purchased by the women in the house. The company offers one of the widest portfolios of sleepwear products among apparel retailers in India in terms of fabrics, colours, and styles. The company’s sleepwear products include Pyjamas, Night Sets, Nighties, T-shirts, etc. It designs its products to cater to men and women across all age groups including kids (from age 2 Year to 16 Year) and fits that are suitable to various body types and physiques. In addition, it is in adjacent categories such as loungewear, workout wear, athleisure, and work leisure pants.
Majority of its manufacturing is outsourced to the Job workers (on contract manufacturing basis) who manufacture products as per the design and requirement of the company. The Contract manufacturing enables it to cater bulk orders and deliver the products to its customers on time. It achieves varied price points through its two product lines: Essentials and Fashion. Its Essentials product line is characterized by limited print or design, is relatively insulated from changes in fashion trends, lower ASPs, high repeat purchases and is sold throughout the year. Its Fashion product line on the other hand is characterized by seasonal designs, low repeat purchases, higher ASPs and is sold seasonally (Autumn/Winter and summer seasons).
Asset Light Business Model The company operates on an asset-light model, managing all aspects of its sales operations without owning the properties where its stores are located. This approach allows for greater scalability and supports the efficient expansion of Exclusive Brand Outlets (EBOs).
Market Cap
₹ 245 Cr.
Current Price
₹ 131
High / Low
₹ 215 / 86.4
Stock P/E
32.9
Book Value
₹ 54.5
Mar 2021 Mar 2022 Mar 2023 Mar 2024
|Debtor Days|171|155|157**|210|**
|Inventory Days|115|148|142|124|
|Days Payable|123|123|113|92|
|Cash Conversion Cycle|163|179|186|243|
|Working Capital Days|131|143|150|189|
|ROCE %||33%|15%|19%|
Big investors in the scrip: Mr Utpal Seth partner of Late Mr Rakesh Jhunjhunwala, Rare Enterprises owns 8% of the company.
I initiate this thread to discuss more on the scrip with esteemed community members and enlighten myself with their wisdom sharing. Your comments, analysis and counter arguments are more than welcomed.
Disc: Invested