Campus Activewear made a strong debut, listing at ₹355, up 22 percent from its issue price of ₹292 per share on the BSE on Monday. The stock ended at 29.66 percent a premium to its issue price at ₹378.60. In comparison, the Sensex ended 0.67 percent or 365 points lower at 54,470.67.
Campus Activewear’s initial public offering (IPO) garnered a strong response as issue was subscribed 51.75 times. The institutional investor portion of the IPO was subscribed 152 times, the wealthy investor portion was subscribed 22.25 times and the retail investors' portion was subscribed 7.7 times.
"Campus Activewear Limited has debuted above its issue price. The company’s good listing during such a volatile market highlights the inherent strength of the company’s business and fundamentals. Campus Activewear Limited is India's largest sports and athleisure footwear brand that enjoys competitive advantages like integrated manufacturing facilities, strong brand recognition, and a robust distribution network. The company has a huge runway of growth and the long-term prospects are good. Those who applied for listing gains can maintain a stop loss of Rs. 300. We recommend this stock for the long term to both existing and new investors," Santosh Meena, Head of Research, Swastika Investmart.
The IPO opened on April 26 and close on April 28. The IPO will be purely an offer for sale of up to 4.79 crore shares by its existing shareholders and promoters. The proceeds won't come to the company but its stakeholders. The offer seeks to raise ₹1,400 crore at the upper end of the price band of ₹278-292 apiece.
Campus Activewear’s ₹1,400-crore IPO was entirely a secondary share sale by existing shareholders including private equity firm TPG.
Domestic brokerages had recommended their clients to subscribe to the IPO citing favourable valuations compared to other listed peers such as Relaxo Footwear and Bata India.
Campus Activewear introduced the brand 'Campus' in 2005 and is a lifestyle-oriented sport and athleisure footwear company that offers a diverse product portfolio. The company has a network of over 15,000 multi-brand retail stores, company-owned exclusive outlets and e-commerce portals. It competes with global brands like Adidas, Rebook and Puma, and domestic brands like Bata and Relaxo. Its market share rose from 15 percent in FY21 to 17 percent in FY22.
Campus is an aspirational Indian brand in the footwear category, which caters to the economic to the mid-premium category of footwear. Over the last decade, it has grown its volumes at around 20 percent CAGR.
"Replicating a similar growth trajectory would be a critical factor in sustaining premium valuations", analysts at ICICI Securities said. The brokerage firm had assigned a 'subscribe' rating given its niche positioning in a fast-growing segment, which would enable it to deliver sustainable profitable growth.