Talwalkars is in a sweet spot, marked by strong brand visibility in a growing market. Being the market leader in Indian fitness industry enables it to acquire competing local fitness brands, while retaining their identities and making it possible to sustain their growth, thereby allowing Talwalkars to fast-track its presence in various markets. Its focus on expanding its footprint through alliances and low cost PWG would help it enjoy improved margins — NPM of 27.1% and 29.5% in FY19 and FY20 respectively. In view of its recent performance, we have marginally changed our EPS estimates (Rs 23.80 vs earlier estimate of Rs 25.18 for FY19 and EPS of Rs 30.06 vs earlier estimate of Rs 32.94 for FY20). On balance, we recommend ‘buying’ the stock with target price of Rs 150 (previous target Rs 165) based on 5.0x FY20e EPS of Rs 30.06 over a period of 9-12 months.