Retail Stocks to Buy Before Q2 Results: Metro Brands, Campus Activewear and Vishal Mega Mart, Elara Securities Expects 11.8% Revenue Growth in Q2 FY27, Festive Shift Hits Apparel, Targets, Valuation and Risks
- October 12, 2026
- Posted by: Ankit Jaiswal
- Category: News
Retail stocks: Elara Securities expects 11.8% Q2 FY27 revenue growth, led by value retail, footwear and innerwear; apparel weaker as festive buying shifts to Q3. Picks: Metro Brands, Campus Activewear, Vishal Mega Mart. HDFC Securities: Metro ADD, target Rs 1,030.
Quick Answer
Elara Securities expects India’s retail sector to post 11.8% revenue growth in Q2 FY27, led by value retail, footwear and innerwear, while apparel may weaken as festive purchases shift to the next quarter. The brokerage favours Metro Brands, Campus Activewear and Vishal Mega Mart, which fits the pattern of low-priced everyday categories holding up better than discretionary fashion. Other brokerages back parts of this view, with HDFC Securities rating Metro Brands ADD with a target of Rs 1,030 and Motilal Oswal and HSBC rating Vishal Mega Mart Buy with targets of Rs 135 and Rs 153. The festive shift makes Q2 numbers look soft, so retail stocks are really a test of Q3 demand, and Elara’s own price targets were not available to me.
Retail stocks have been among the weaker groups this year, with Metro Brands down about 34% and Vishal Mega Mart down about 30% over a year according to the reports below. That is why the Elara call is getting attention just before the Q2 results season.
This guide covers what Elara expects for retail stocks in Q2 FY27, why the festive shift matters, how each of the three picks looks, valuation, risks and what to watch when results arrive.
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Elara Securities View on Retail Stocks for Q2 FY27
| Item | Elara expectation | Note |
|---|---|---|
| Sector revenue growth | 11.8% year on year | For India’s retail sector in Q2 FY27 |
| Stronger categories | Value retail, footwear and innerwear | Everyday and lower-ticket categories |
| Weaker category | Apparel | Festive purchases shift into the next quarter |
| Preferred picks | Metro Brands, Campus Activewear, Vishal Mega Mart | Elara recommends them before the results |
The call is about mix, not about demand disappearing. Retail stocks tied to value and footwear are expected to cope with the calendar shift better than apparel names.
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Why the Festive Shift Matters for Retail Stocks
- Calendar: festive buying that fell in Q2 last year is moving into Q3 this year, which lowers Q2 growth and lifts Q3.
- Apparel exposure: fashion and apparel sales are the most festival-linked, so they feel the shift most.
- Everyday categories: footwear, innerwear and value retail are bought through the year and are less affected.
- Comparisons: a 13% Q2 revenue growth from Metro Brands (per HDFC Securities) and 18.4% from DMart show healthy sales despite the shift.
A soft Q2 for retail stocks is therefore partly timing. The real test comes in Q3, when the shifted festive demand is counted.
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Metro Brands: HDFC Securities Rates It ADD
| Item | Detail | Note |
|---|---|---|
| Rating and target | ADD, target Rs 1,030 (cut from Rs 1,060) | HDFC Securities, 30 September 2026 |
| Price at the time | Rs 847 | Implied upside about 22% (my calculation) |
| Q2 FY27 revenue | Up about 13% | Festive demand moves from Q2 to Q3 |
| Q2 FY27 EBITDA margin | About 25.8% | Around 40 basis points of pressure from minimum wage hikes |
| Share price trend | Down about 34% over one year | The report says valuation is more reasonable |
| Growth driver | Walkway stores, Clarks and Fila | 33 Walkway stores added in FY26 |
The report has small inconsistencies, such as the ADD rating being defined as 5% to 15% return potential while the target implies about 22%. FY27 EPS is estimated at Rs 16.6, so the price of Rs 847 is about 51 times that figure (my calculation), which is still a premium among retail stocks.
Campus Activewear: Volume-Led Growth
| Item | Q1 FY27 | Comparison |
|---|---|---|
| Revenue | Rs 385.20 crore | Up 12.21% year on year, down 15.45% quarter on quarter |
| Volume | 5.71 million pairs | Up 11.7% year on year |
| Average selling price | About Rs 674 per pair | Rs 671 a year earlier |
| EBITDA margin | 15.9% | Flat quarter on quarter |
| Profit after tax | Rs 26.14 crore | Up 17.74% year on year |
Campus sells lower-priced sports and casual footwear, which suits Elara’s value and footwear theme. I did not find Elara’s rating or target for the stock, and one review of Q1 said the re-rating depends on the next quarters confirming volume-led growth.
Vishal Mega Mart: Value Retail at a Lower Price
| Item | Detail | Note |
|---|---|---|
| Same-store sales growth | 10% in Q1 FY27 | Against about 7% for peer value retailers |
| Hyperlocal users | 14.1 million, up 44% | Quick commerce is 2% to 10% of the mix across stores |
| Brokerage views | Motilal Oswal Buy, target Rs 135; HSBC Buy, target Rs 153 | HSBC expects Q2 moderation from the festival shift |
| Valuation | About 40 times 2027-28 earnings | Share price down about 30% over one year |
| Overhang | Promoter stake cut from about 75% to about 40% | Motilal Oswal calls further stake sales a key overhang |
Vishal Mega Mart fits the value retail theme, but the promoter stake sales mean supply can keep a lid on the stock.
How the Three Retail Stocks Compare
| Stock | Category | Strength | Watch point |
|---|---|---|---|
| Metro Brands | Premium footwear | Walkway expansion and store additions | Wage costs and a premium multiple |
| Campus Activewear | Value sports footwear | Volume growth of 11.7% | Quarterly profit swings |
| Vishal Mega Mart | Value retail | Same-store growth of 10% | Promoter stake sales |
Each pick leans on a different driver, so owning all three retail stocks does not remove the common risk of weak consumer demand.
Risks for Retail Stocks Before Q2
Timing: If festive demand arrives later than expected, Q3 may not make up the Q2 gap.
Costs: Minimum wage hikes and rent can squeeze margins, as the Metro Brands note shows.
Valuation: Metro Brands trades at roughly 51 times FY27 earnings (my calculation), which leaves little room for a miss.
Competition: Quick commerce and online players are pulling demand away from retail stocks in dense cities.
Missing data: Elara’s targets and ratings for all three retail stocks were not available, so check the report.
What to Watch When Q2 Results Arrive
- Revenue growth against Elara’s 11.8% sector expectation.
- EBITDA margin for Metro Brands against the 25.8% estimate.
- Volume and margin at Campus Activewear after the weak Q1 profit trend.
- Same-store sales growth at Vishal Mega Mart against the 10% in Q1.
- Management commentary on Q3 festive demand across retail stocks.
Conclusion
Elara Securities expects 11.8% revenue growth in Q2 FY27 and likes Metro Brands, Campus Activewear and Vishal Mega Mart among retail stocks, helped by a value and footwear tilt. The festive shift makes Q3 the real test, so check the results and the brokerage reports for targets. Consult a SEBI-registered advisor before making any decision.
Disclaimer: Data and figures in this article are sourced from publicly available information. These may or may not be accurate. Please verify all data with the official NSE (nseindia.com) and BSE (bseindia.com) websites before making any investment decision. Investments in securities are subject to market risk. This content is for educational purposes only and is not investment advice by Univest (SEBI RA INH000013776).
Frequently Asked Questions
Which retail stocks does Elara Securities recommend before Q2?
Ans. Elara favours Metro Brands, Campus Activewear and Vishal Mega Mart.
What revenue growth does Elara expect for retail stocks in Q2 FY27?
Ans. About 11.8% year on year, led by value retail, footwear and innerwear.
Why may apparel be weak in Q2?
Ans. Festive purchases are shifting to the next quarter, which hurts apparel sales in Q2.
What is the HDFC Securities target for Metro Brands?
Ans. ADD with a target of Rs 1,030, cut from Rs 1,060, against a price of Rs 847 on 30 September 2026.
What are the brokerage targets for Vishal Mega Mart?
Ans. Motilal Oswal has a Buy with a target of Rs 135 and HSBC has a Buy with a target of Rs 153.
How did Campus Activewear perform in Q1 FY27?
Ans. Revenue was Rs 385.20 crore, up 12.21% year on year, with profit after tax of Rs 26.14 crore.
What are the main risks for retail stocks?
Ans. Festive timing, wage costs, high valuation, quick commerce competition and promoter stake sales.
Should I buy retail stocks before Q2 results?
Ans. This article does not constitute investment advice. Results can move stocks sharply. Consult a SEBI-registered financial advisor.
