A employee walks between shelves stacked with boxes of shoes at a store in New Delhi (Photographer: Anindito Mukherjee/Bloomberg)

Khadim India Falls 5% Over IPO Price On Stock Market Debut

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Khadim India made its stock market debut at a discount of 3.07 percent at Rs 727 per share compared to an issue price of Rs 750 apiece. The stock fell 5 percent to Rs 712.40 thereafter.

Promoter Siddhartha Roy Burman and Anil Ambani-led private equity fund sold 65.7 lakh shares in the Rs 543 crore initial public offering that was subscribed 1.9 times. The company also raised Rs 50 crore as fresh issue of which Rs 40 crore will be used for debt repayment.

Qualified institutional buyers and high net worth individuals put in bids for 2.44 and 0.18 times the shares on offer, respectively. The portion reserved for retail buyers was subscribed 2.33 times. At the issue price, Mahindra Logistics will command a market capitalisation of close to Rs 1,347 crore, according to BloombergQuint’s calculations.


Khadim India is the second largest footwear brand by exclusive retail stores in India after Bata India Ltd. The company runs most of its stores as franchises and doesn’t necessarily own them. It operated 853 Khadim’s branded exclusive retail stores, of which 80 percent were franchises as of June 30.

The company generates majority of its revenue from retail and distribution. The share of distribution has increased over the years.

It has two manufacturing units in West Bengal and four distribution centres across India. Most of its stores and distributors are in east and south India.

Financial Highlights

  • Khadim India’s net worth stood at Rs 192 crore for the quarter ended June, translating into a book value of Rs 107 apiece after issuing new shares.
  • Revenue grew at an annualised rate of 10 percent and net profit rose at 13 percent in five years to March.
  • Revenue and net profit for the quarter ended June stood at Rs 178 crore and Rs 7 crore, respectively.
  • The company has not declared any dividend in the last four financial years.
  • Earnings before interest and tax margin was 8 percent in the year to March, showing an improvement compared to the last two years.

Peer Comparison

It competes with listed rivals like Bata India Ltd. and Relaxo Footwears Ltd.

Khadim’s net profit has grown faster than peers, but margins remain muted due to an asset-light model. The comparable growth rate for Bata India was not available as the company changed its accounting year.

Khadim India’s return ratios also lagged behind Relaxo, but were better when compared to Bata India.

It had a total debt of Rs 118 crore as of March 31 and a comparatively higher total debt-to-equity. Its biggest rival Bata India is debt-free.

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