The Rs 1,400 crore Campus Activewear IPO will be available for subscription till Thursday, April 28, 2022, and the price band of the company has been fixed at Rs 278-292 per share.
Campus Activewear is a Delhi-based footwear firm that introduced the brand ‘Campus’ in 2005. It offers a diverse product portfolio for the entire family.
The IPO is entirely an offer for sale (OFS) of 4.79 crore (4,79,50,000) equity shares by promoters and existing shareholders. Those selling shares in the OFS include promoters Hari Krishan Agarwal and Nikhil Aggarwal and other existing shareholders – TPG Growth III SF Pte Ltd, QRG Enterprises Ltd, Rajiv Goel and Rajesh Kumar Gupta.
Currently, the promoters own over 23.8 crore (23,80,09,004) equity shares which represents a 78.21 per cent stake of the footwear company while TPG Growth and QRG Enterprises have 17.19 per cent and 3.86 per cent stake respectively, the red herring prospectus (RHP) data showed.
The remaining 0.74 per cent stake is held by individual shareholders and current employees.
On listing, Campus Activewear will join other listed footwear peers such as Bata India, Relaxo Footwears, Khadim India, Liberty Shoes, Metro Brands and Mirza International.
As of fiscal year 2020 (FY20), the brand had about 15 per cent of market share in the branded sports and athleisure footwear industry in India by value, which increased to approximately 17 per cent in FY21.
Half of the issue size has been reserved for qualified institutional buyers (QIBs), 35 per cent for retail investors and the remaining 15 per cent for non-institutional investors. Additionally, two lakh shares have been reserved for the employees.
Investors who wish to subscribe to Campus Activewear IPO can bid in a lot of 51 equity shares and multiples thereafter. At the upper price band, they will be shelling out Rs 14,892 to get a single lot of Campus Activewear. The shares will be listed on both BSE as well as the National Stock Exchange (NSE).
The applicants also must note that the cut-off time for UPI mandate confirmation is Friday, April 29, 2022, upto 12:00 pm. If they fail to do so then their application may not be considered.
JM Financial, BofA Securities India, CLSA India and Kotak Mahindra Capital Company are the book running lead managers to the offer while Link Intime India is the registrar of the issue.
Before heading into the IPO, Campus Activewear on Monday raised over Rs 418 crore (Rs 4,18,29,00,000) from 32 anchor investors in lieu of 1,43,25,000 equity shares at Rs 292 each, data from the stock exchanges showed.
The anchor investors include the likes of Abu Dhabi Investment Authority, Fidelity Funds, Nomura, Societe Generale, BNP Paribas Arbitrage, Goldman Sachs (Singapore) Pte, HDFC Life Insurance Company, ICICI Prudential Life Insurance Company, ICICI Prudential Mutual Fund (MF), Aditya Birla Sun Life MF, Motilal Oswal MF, DSP MF, Nippon India MF and Invesco MF among others.
The research teams at IIFL Securities and Anand Rathi Share and Stock Brokers in their respective IPO notes have recommended a “Subscribe” to the offer.
IIFL Research in its IPO report said, “At the upper price band of Rs 292, Campus Activewear Limited is demanding a PE multiple of ~217.9X based on weighted average earning from FY19 to FY21 while the company’s price to sales ratio is at 12.49X of FY21 revenue. The industry average PE multiple is 98.49X of FY21. Considering the growing sports market, 85 per cent market share of the total addressable market for sports and athleisure footwear in India, robust distribution network, and difficulty to replicate integrated manufacturing capabilities, we recommend subscribe to the issue with a longterm perspective.”
Anand Rathi Research in its report said “At the high of the issue price-band (Rs 292), the stock is valued at ~66x FY20 EV/EBITDA and ~142x P/E. Footwear companies quote at an average EV/EBITDA of 35.7x/29.5x FY23e/FY24e and P/Es of 64x/51x. We reckon operations in a fast-growing segment, a high and rising market share and strong financials are positives. Risks: Strong international brands in a competitive sector, rise in raw-material prices.”
The share allotment is likely to take place on Wednesday, May 4, 2022, and the shares are expected to be listed on Monday, May 9, 2022, according to the timeline given in the RHP.