After a tremendous response for its IPO, investors now await the allotment results for the shares of Go Fashion, the operator of leading women's bottom-wear brand Go Colors, which is expected to be finalised later this week.
Its public offer sailed through despite weakness in the equity market and disappointing debut of Paytm, and was subscribed 135.46 times during November 17-22. The offer received bids for 109.4 crore equity shares against an IPO size of 80.79 lakh equity shares.
Non-institutional investors bought shares 262.08 times their reserved portion and a part set aside for qualified institutional investors saw 100.73 times subscription, while retail investors had put in bids 49.70 times the portion set aside for them.
Here Is How To Check Share Allotment Online
The apparel company will finalise the basis of allotment by November 25. Investors can check their allotment status either on the BSE website or the website of IPO registrar.
On the website of IPO registrar, the investor has to
a) Select IPO (Go Fashion India Limited)
b) Select and accordingly enter either Application Number, or DPID/Client ID, or PAN Number
c) Finally, enter the Captcha and click on Submit
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Alternatively, the allotment can be checked on the BSE website.
a) Select Equity and Issue Name (Go Fashion India Limited)
b) Enter Application Number, and PAN Number
c) Finally, check the box (I'm not a robot) and click on Search.
The company will initiate refunds to unsuccessful investors by November 26 and the eligible investors will get equity shares in their demat accounts by November 29.
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Equity shares of Go Fashion will debut on the BSE as well as NSE on November 30, the 53rd listing in 2021.
Grey Market Premium
Shares of Go Colors are also witnessing strong demand in the grey market as they were trading at Rs 1,040 per share, a 51 percent premium (Rs 350) over the expected final issue price of Rs 690, as per IPO Watch and IPO Central.
Experts believe the 50 percent grey market premium indicates good listing price, but the valuation may be deemed expensive compared to peers.
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"Go Fashion is a well-established women's bottom wear brand in India with multi-channel distribution. The price-to-sales ratio is at 13.73, which is comparable to its peers Page Industries and Trent. It has been a good track record of revenue growth, return on equity, and operating margin, making it attractive," said Sonam Srivastava, Founder of Wright Research.
The women's bottom wear industry is expected to grow to Rs 24,300 crore by FY25 from Rs 13,500 crore in FY20.
"The company has tremendous opportunity due to its strong brand presence. While the valuation is justified with peers as per the listing price, a 50 percent premium should make it very expensive compared to its peers when Aditya Birla Retail and Reliance Fashion trade at a significantly lower valuation," said Srivastava.
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The grey market premium suggests a good listing, but the long-term valuation could get expensive at a 50 percent premium price as the GMP presents, she added.
Go Fashion has raised Rs 1,013.6 crore through its public issue that comprised a fresh issuance of shares worth Rs 125 crore, and an offer for sale of Rs 888.6 crore by promoters (PKS Family Trust and VKS Family Trust), and investors (Sequoia Capital India Investments IV, India Advantage Fund S4 I, and Dynamic India Fund S4 US I).
The net proceeds from the fresh issue will be utilised for funding rollout of 120 new EBOs (exclusive brand outlets); and working capital requirements, besides general corporate purposes.
Performance
Go Colors had enjoyed a market share of approximately 8 percent in the branded women's bottom-wear market in FY20. The share of organised retailing within women's apparel is expected to increase from 27 percent in FY20 to 42 percent by FY25.
The organised share of women's bottom-wear market is expected to reach Rs 9,240 crore with a share of 38 percent in FY25, growing at a CAGR of 24.3 percent until 2025.
The company sells its products through its extensive network of 459 EBOs that are spread across 23 states and union territories in India, as of September. It also distributes products through large format stores (LFSs), which have grown from 925 LFSs as of March 2019 to 1,270 as of September.
It also sells products through its own website and online marketplaces, and through multi-brand outlets (MBOs).
Exclusive brand outlets' segment contributed 68.92 percent to total revenue in FY21, large format stores accounted for 22 percent to revenue, online 4.76 percent, and MBOs and others contributed 4.31 percent to overall revenue.
Go Fashion posted a loss of Rs 3.54 crore in the financial year ended March 2021 against a profit of Rs 52.63 crore in FY20, impacted by Covid-led lockdowns. Revenue in FY21 also declined to Rs 250.66 crore from Rs 392.01 crore in FY20.
Its loss widened to Rs 18.99 crore in Q2FY22 from a loss of Rs 8.59 crore in Q2FY21, but revenue increased significantly to Rs 30.99 crore from Rs 10.3 crore in the same period.
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