Footwear shares rally upto 18% after Campus IPO opens for subscription

Khadim India surged 18% to Rs 274, while Liberty Shoes surged 13% to Rs 177.95, followed by Superhouse (11% to Rs 209) and Mirza International (6% to Rs 230).

Shares of footwear companies rallied upto 18 per cent on the BSE in Tuesday’s intra-day trade after an initial public offering (IPO) of Campus Activewear (Campus) opened for subscription today.

Among individual stocks, Khadim India surged 18 per cent to Rs 274, while Liberty Shoes surged 13 per cent to Rs 177.95, followed by Superhouse (11 per cent to Rs 209) and Mirza International (6 per cent to Rs 230). Bata India, Relaxo Footwears and Metro Brands were up 2-4 per cent. In comparison, at 11:15 am, the S&P BSE Sensex was up 1 per cent at 57,137 points.

Campus is one of the fastest growing sports and athleisure footwear brands in India, which covers around 85 per cent of its total addressable market. Campus has around 17 per cent market share in branded sports and athleisure footwear in India and is the largest player in terms of volume (13.6 million pairs).

The Rs 1,400 crore IPO will close on Thursday, April 28, 2022. The issue is entirely an offer-for-sale (OFS) from the promoters and existing shareholders of the company.  The company garnered a little over Rs 418 crore from 32 anchor investors ahead of its initial share-sale. It had finalized allocation of total 14.32 million equity shares to anchor investors at allocation price of Rs 292 per share.

Abu Dhabi Investment, Fidelity Funds – India Focus Fund, The Nomura, East Spring, Ashoka India and HDFC trustee allotted 917,898 equity shares or 6.41 per cent of the anchor investor portion, the company said. Nippon Life, Societe general, Goldman, Motilal Oswal, Invesco among other marquee investors are allotted shares. CLICK HERE FOR FULL LIST

The overall footwear Industry (Rs 72,000 crore) is expected to grow at a CAGR of 8 per cent in FY20-25E whereas sports and athleisure segment (Rs 11,000 crore) is expected to increase at a CAGR of 15 per cent during the same period.

“Campus is an aspirational Indian brand in footwear category, which caters to economic to mid premium category of footwear. Over the last decade, it has grown its volumes at around 20 per cent CAGR. Replicating similar growth trajectory would be a critical factor in sustaining premium valuations,” analysts at ICICI Securities said in an IPO note.

The Indian footwear market has followed the trend and witnessed healthy growth on account of a rise in income levels, increase in awareness of brands and fashion styles, rise in modern retail, heightened discretionary spending and increase in urbanization.

The market size witnessed a decline of around 33 per cent YoY in FY21 on account of reduced consumer spending due to the pandemic. Going forward, the Indian footwear consumption in value terms is expected to grow at 17 per cent CAGR in FY22-25E. Rise in income levels, standard of living, footwear as fashion statement, footwear volumes in urban areas with different footwear purchased for different occasions, women workforce participation and brand awareness are expected to contribute to growth of the footwear market, the brokerage said.