Campus Shoes IPO
Campus Activewear Ltd, founded on September 24, 2008, specializes in the production, distribution, and sale of athletic and athletic-inspired footwear. In FY21, it was one of India’s leading sports and athleisure footwear brands in terms of value and volume, with a 17 percent market share in this category.
In FY20, revenue increased by 23%. Over FY20, the EBITDA margin was about 17-18%, while profit after tax margins was between 7 and 9%. The EBITDA margin was 19.4 percent in the first nine months of FY22, with revenues of Rs 842 crore. For the first nine months of FY22, the firm had a return on equity of 21.9 percent and a return on capital employed of 22.7 percent.
As of December 31, 2021, Campus has over 425 distributors handling and completing orders for over 19,200 geographically mapped merchants throughout India. Metro and Tier 1 cities account for almost 26.7 percent, while Tier 2 and 3 villages account for 73.1 percent. On April 26, Campus will launch its initial public offering (IPO), which will run through April 28. On April 25, the anchor book section will be open for a day.
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Details of the Campus Activewear IPO
The Rs 1,400 crore offer is fully composed of promoters and current shareholders offering 4.79 crore equity shares for sale. Employees will be able to reserve up to 2 lakh shares at a discounted rate of Rs 27 per share compared to the final offer price.
The offer’s price range has been set at Rs 278-292 per share. Investors may place bids for a minimum of 51 equity shares and then in multiples of 51 shares. A minimum investment of Rs 14,892 for one lot and a maximum investment of Rs 1,93,596 for 13 lots is available to retail investors.
Qualified institutional purchasers will get half of the offer, non-institutional bids would receive 15%, and retail investors will receive the remaining 35%. The corporation will not profit from this public offering, and all proceeds will be distributed to selling stockholders. The purpose of the offer is to take advantage of the advantages of listing equity shares on stock exchanges and to complete the offer for sale.
Brokerage Views on Campus Activewear IPO
Because the firm is India’s top sports and athleisure footwear brand, brokerages have expressed confidence in the company’s response to the matter. It boasts difficult-to-replicate integrated production capabilities, as well as a reliable supply chain. It also has a strong omnichannel sales and distribution network with a pan-India presence and considers its move to the premium category to be a positive step.
Experts predict that Indian retail footwear would increase at an annual pace of 8% between FY20 and FY25, and 21.6 percent between FY21 and FY25, making it one of the fastest-growing discretionary categories throughout this time.
The brokerages believe that the firm’s expansion plans and broaden its omnichannel experience, diversification through aimed product innovation, emphasis on investment opportunities to further incorporate its distribution network, and remaining focused on digitalization to refine brand emphasis and push sales volumes will help the firm’s performance and profitability. However, the existence of powerful worldwide brands in a competitive field, as well as the possibility of rising raw material costs, pose threats to the firm.
Further Key Takeaways
Brokerages feel the company’s ability to provide a varied product portfolio for the whole family, including color palettes, styles, pricing ranges, and an appealing product value proposition, offers it an advantage over competitors. “With a 17 percent market share in India’s branded sports and athleisure footwear business and an integrated manufacturing infrastructure that supports cost leadership advantage,” the brokerages said in a report.
Another brokerage said that the company’s primary risks and worries stem from the prospect of a global economic downturn, its failure to attract customers and adapt to market trends, competition, volatility in critical raw material costs, and an unfavorable revenue mix.
Consider visiting the Angel One website now to learn more about the markets and Campus Activewear’s initial public offering. If you are new to the market, you may open a demat account here and begin trading and investing right now.
Disclaimer: This blog is exclusively for educational purposes and does not provide any advice/tips on investment or recommend buying and selling any stock.