NEW DELHI: Campus Activewear’s initial public offering (IPO) received thumps up from investors as the offer got subscribed 51.75 times by the end of April 28, the final day of bidding. The issue, which was opened on April 26, received bids for over 174 crore equity shares as against the leading footwear brand’s offer size of 3.36 crore equity shares.
Qualified institutional investors led the subscription with their reserved portion getting subscribed 152.04 times, followed by non-institutional investors who bid shares 22.25 times the allotted quota. Retail investors’ quota was subscribed 7.7 times while that of employees portion was booked 2.11 times.
Market experts believe that the IPO will give a decent listing gain despite current volatility as it is commanding a premium of 30% in the grey market. The IPO, which is worth Rs 1,400 crore in size, is entirely an offer for sale by investors and promoters. The price band of the IPO was kept at Rs 278-292 per share.
“At the upper price band, the company is valued at 8x market cap/sales and around 93x P/E (price-to-earnings) on TTM (trailing 12 months) basis,” said ICICI Direct in a note. The brokerage assigned a subscribe rating given its niche positioning in a fast-growing segment, which would enable it to deliver sustainable profitable growth.
According to the note, the company registered a healthy revenue CAGR of around 20% in FY18-20 with average EBITDA margins of around 18%.