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27 March 20236 mins read by Angel One
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December seems to be another action-packed month for IPOs, as several big ones get ready to launch. Metro Brands, a famous footwear retailer in India, has announced more of its IPO details. Those keen to subscribe to this company’s initial public offering may look at the details provided here before making a decision.

So, let’s dive right into the details.

Metro Brands IPO Details in Brief

IPO Opening Date 10 December 2021
IPO Closing Date 14 December 2021
Issue Type Book Built Issue
Face Value Rs. 5 per equity share
Maximum Order Size 13 lots

Key Highlights of Metro Brands IPO

The IPO or the company’s initial public offer consists of a new issue of equity shares and an offer of sale. The fresh issue of equity shares will amount to Rs. 295 crores.

On the other hand, the OFS (offer of sale) will see shareholders and promoters offloading 2,14,50,100 equity shares. Here is a break up of the offer of sale.

Type of Investor Shares Divesting
Promoter Selling Shareholders 1,30,15,000 equity shares
Promoter Group Selling Shareholders 84,20,000 lakh equity shares
Other shareholders 8,100 equity shares

Further, the company had tried to raise money privately to the tune of Rs. 3.29 crores from the sale of 73,136 shares. So the issue has seen a couple of changes in size. It was reduced from Rs. 250 crores to Rs. 246.7 crores butlater increased to Rs. 295 crores.

The objective of the issue is to raise funds to open more stores for its brands such as Mochi, Walkway, Metro and Crocs. It will also use the funds for regular corporate purposes.

Rekha Jhunjhunwala is the 3rdlargest shareholder, owning 14.73% as stake. Other promoter groups and promoters hold 83.99%.

About the Company

Metro Brands Limited was established in 1955 and became one of India’s largest footwear retailers. The company makes footwear for men, women, children and unisex models. Some of its famous brands are:

  • Mochi
  • Metro
  • Fontini
  • Davinchi

Also, some of its third party brands are:

  • Skechers
  • Florsheim
  • Fitflop
  • Crocs
  • Clarks

This company also offers bags, belts, wallets, masks, etc. Interestingly, the company models the COCO (Company-Owned and Company-Operated) business model. Metro Brands has its multi-brand outlets and exclusive brand outlets which manage its stores.

Financial Highlights

The financials of the company are shown below:

For the year ended 31 March 2021 31 March 2020 31 March 2019
Total Assets 16,593.40 16,174.23 13,215.06
Total Revenue 8,785.38 13,110.68 12,368.95
Profit After Tax 646.19 1,605.75 1,527.31

Note: Values are in Rs. Millions

The company operates around 598 stores spread over 136 cities and 30 states. Rakesh Jhunjhunwala has been an investor since 2007.

Competitive Strengths

  • This company is one of India’s largest footwear retailers
  • The operating model is efficient, and it is asset-light
  • Strong promoter background
  • Robust track record of profitability
  • Moreover, it offers a vast product range of bags, shoes, wallets, etc.
  • It is the first choice for international and national third party brands
  • It has its presence across multiple channels.
  • Experienced management team

Bottom Line

The company’s promoters are offloading 10% stake in this IPO. The stakes of the promoter and promoter groups will come down to 75% from close to 85%. Those who are looking to invest in Metro Brands Ltd. should make an informed choice after thorough analysis and research.

 

Frequently Asked Questions

  1. Who are the promoters of this company?

Ans.  The promoters of this company are:

  • Alisha Rafique Malik
  • Aziza Malik Family Trust
  • Farah Malik Bhanji
  • Rafique A. Malik
  • Rafique Malik Family Trust
  1. What is the timeline for the share allotment and the listing?

Ans. The timeline for the share allotment and listing is shown below:

  • Basis of Allotment Date – 17 December 2021
  • Initiation of Refunds – 20 December 2021
  • Shares credited to Demat Accounts -21 December 2021
  • IPO listing -22 December 2021
  1. Who are the book running lead managers to the issue?

Ans. The book running lead managers to the issue are:

  • Axis Capital
  • Ambit
  • DAM Capital Advisors
  • Equirus Capital
  • ICICI Securities
  • Motilal Oswal Investment Advisors

 

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