Credo Brands Marketing, which is also known as Mufti Menswear, failed to meet analysts' expectations on the listing front despite the market reached to new high with a percent gains. Also the performance was not even in line with its healthy financial performance and robust IPO subscription numbers.
The stock was opened at Rs 282.35, which was just 0.8 percent higher compared to the issue price of Rs 280, on the NSE, and dropped 6.6 percent to touch a day's low of Rs 261.60. The stock immediately recovered in early trade, and climbed up to Rs 325.
Overall, it remained volatile throughout session. During the day, the stock went up to Rs 325 many times but could not sustain those higher levels.
Finally, it settled at Rs 312.20, up 11.50 percent with volume of 3.12 crore equity shares on the NSE, while the closing price on the BSE was Rs 312.50, up 11.61 percent with volume of 18.29 lakh shares.
Analysts had expected Mufti to debut at least with 25 percent premium over the issue price and the grey market premium was around 35-40 percent.
Credo Brands Marketing has raised Rs 549.78 crore through initial public offering which was only an offer-for-sale by the existing shareholders. The price band for the offer was Rs 266-280 per share.
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The public issue was oversubscribed by 51.85 times during December 19-21.
Mufti with asset light business model only designs the products and outsources the entire range of products manufacturing (from shirts to t-shirts to jeans to chinos).
Hence, with strong brand image in the market, Credo recorded an impressive CAGR of around 42 percent for revenue between FY21 and FY23, with net profit doubling over the previous year and showing a multi-fold increase compared to FY21.
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