Introduction: What Just Happened to ABFRL?
ABFRL shares crashed nearly 10% in early trade on June 4, leaving investors confused and anxious. Why? Flipkart Investments, owned by Walmart, offloaded a massive 6% stake—worth ₹580 crore—via a block deal at a 7% discount to the market price.

The stock dropped like a hot potato, clocking over ₹1,075 crore in turnover on the NSE before the clock even hit 9:30 AM.
And this wasn’t just another exit. The timing was critical. This selloff came right after ABFRL’s demerger, which separated its high-profile lifestyle brands into a new entity (ABLBL). Now, the focus of ABFRL is purely on value fashion and digital-first retail.
So here’s the million-dollar question buzzing across D-Street:
👉 Is ABFRL stock still worth it after Flipkart’s big exit?
In this blog, we’ll decode the reasons behind the fall, what the company looks like post-demerger, what analysts are saying, and finally — whether you should still consider holding or buying this stock.
Why ABFRL Stock Crashed: Breaking Down the Block Deal
Let’s break it down — no pun intended.
On June 4, Flipkart Investments (owned by Walmart) sold a whopping 7.32 crore shares, or about 6% of ABFRL, via a block deal worth ₹580 crore. And here’s the kicker — the deal was done at ₹79.50 per share, which is a 7% discount to the previous closing price.
Why would Flipkart do that?
Well, Flipkart was likely monetizing its stake in ABFRL now that the lifestyle business has been spun off. The deal happened just days after ABFRL started trading ex-lifestyle, meaning Flipkart is no longer invested in the value fashion and digital brands — its interest was likely in the premium lifestyle play (now ABLBL).
How did the market react?
- NSE Turnover: Over ₹1,075 crore — that’s massive for early trade.
- Price Drop: The stock fell nearly 9% to ₹78.30, its lowest point for the day.
- Sentiment: Retail investors panicked. After all, when a large institutional investor exits, it often triggers fear of deeper trouble.
But not every promoter exit means trouble. Sometimes it’s just profit booking or portfolio rebalancing. The question is: What’s left in ABFRL post-demerger, and is it still valuable?
Let’s answer that next.
What’s Left in ABFRL After the Demerger?
ABFRL’s recent shake-up means the company now mainly focuses on:
- Value Fashion: Brands like Pantaloons and Styleup
- Ethnic Brands: Growing segment with strong demand in India
- Digital-First Brands: New-age brands targeting millennials and Gen Z
- Luxury Retail: Smaller, but steady contributors
The lifestyle brands — including Louis Philippe, Van Heusen, Allen Solly, and Peter England — have been spun off into a new entity, ABLBL, which is expected to list separately by mid-to-end June 2025.

What does this mean for ABFRL’s business?
- Focused Growth: ABFRL can now fully concentrate on expanding value and ethnic brands with better margins.
- Improved Profitability: Analysts expect a 300 basis points increase in EBITDA margins by FY30, driven by operating leverage and turnaround of digital brands.
- Debt-Free Ambition: The company plans to be debt-free in the next 2-3 years, starting with nominal debt.
- Strong Cash Position: ABFRL holds ₹140-150 crore in net cash, enough to fund growth and potential acquisitions.
This streamlined focus could make ABFRL a leaner, more profitable business in the coming years.
Next, let’s look at what experts say about ABFRL’s future prospects.
Expert Opinions and Financial Projections for ABFRL
After the demerger, analysts hold mostly optimistic views about ABFRL’s future.
- JM Financial’s View:
They rate ABFRL as a Hold but expect steady revenue growth of 11% CAGR from FY24 to FY30. This growth will come from expanding value fashion and digital-first brands.
Moreover, EBITDA margins should rise to 11%+, which will help the company triple its cash profits by FY30.
The company’s focus on operating leverage and turning newer businesses profitable supports this outlook. - Valuation Estimates:
JM Financial values the demerged ABFRL at around ₹103 per share by March 2027. They base this on EV/EBITDA and EV/Sales multiples for different business segments.
Meanwhile, the newly formed lifestyle brand entity, ABLBL, has a higher estimated value of ₹186 per share, thanks to its strong brand portfolio. - Market Reaction:
The recent 9% drop in ABFRL’s stock price mainly reflects short-term market reactions to Flipkart’s stake sale.
Large block deals like these often cause temporary volatility but also show investors adjusting their portfolios after big changes.
Bottom line from experts:
ABFRL looks set for steady, profitable growth. However, investors should expect some short-term price swings while the market adjusts to the demerger and stake sale.
Is ABFRL Stock Still Worth Buying?
After the recent price drop and Flipkart’s big stake sale, many investors wonder: Should you buy ABFRL now?
Reasons to Buy:
- Strong Brand Portfolio
ABFRL owns famous brands like Louis Philippe, Van Heusen, Allen Solly, and Peter England. These brands enjoy steady demand and loyal customers. - Focused Business Model After Demerger
The split helps ABFRL concentrate on value fashion and digital-first brands. This focus can improve margins and efficiency. - Promising Growth and Profitability
The company aims for over 11% revenue growth yearly and plans to triple cash profits by FY30. Higher EBITDA margins will boost earnings too. - Low Debt and Healthy Cash
ABFRL started with very low debt and has ₹140-150 crore in net cash. This financial strength gives it flexibility for expansion or acquisitions. - Buying Opportunity After Price Drop
The recent 9% fall caused by Flipkart’s stake sale may offer a good entry point for long-term investors.
Risks to Consider:
- Price Volatility: Large block deals can cause sharp price swings unrelated to business health.
- Competition: Fashion retail is competitive, especially with emerging digital brands.
- Economic Impact: Spending on fashion can slow during economic downturns.
Final Takeaway:
Overall, ABFRL has solid fundamentals and a clear growth plan. While short-term ups and downs may happen, it remains an attractive option for investors focused on long-term gains.
Conclusion: Should You Bet on ABFRL Now?
ABFRL’s recent stock drop and Flipkart’s stake sale may have spooked some investors, but the company’s underlying strength remains solid. With a sharp focus on value fashion and digital brands, strong revenue growth projections, and a low-debt balance sheet, ABFRL is positioned well for the future.
If you believe in the Indian retail sector’s long-term growth and are comfortable with some short-term market noise, ABFRL can be a smart addition to your portfolio.
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FAQs
Q1: Why did ABFRL shares fall nearly 9% recently?
A: The sharp fall was mainly due to Flipkart Investments selling a 6% stake in ABFRL through a block deal, causing high selling pressure and a price dip.
Q2: What is the impact of the demerger on ABFRL?
A: Post-demerger, ABFRL focuses on value fashion and digital-first brands, while the lifestyle brands are spun off into a new entity. This specialization can improve operational efficiency and margins.
Q3: Is ABFRL carrying high debt?
A: No, ABFRL starts with nominal debt and has a net cash balance of ₹140-150 crore, which is favorable for funding growth and expansions.
Q4: What growth can investors expect from ABFRL?
A: The company aims to nearly double revenues at an 11%+ CAGR and triple cash profits by FY30, driven by margin improvements and operational leverage.
Q5: Should I buy ABFRL stock after this price drop?
A: If you are a long-term investor willing to tolerate short-term volatility, ABFRL’s strong brand portfolio and growth outlook make it a good candidate. However, always assess your risk tolerance.
Q6: Who brokered the Flipkart stake sale?
A: Goldman Sachs acted as the broker for the recent block deal where Flipkart sold shares.
Q7: How does ABFRL plan to grow in the future?
A: Through expanding its value fashion brands, growing digital-first labels, network expansion, and improving profitability while aiming to be debt-free.
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