Go Fashion IPO opened today with a price brand of Rs 655 to Rs 690 looking at an issue size of close around Rs 1000 crores and post-issue market cap of nearly Rs 3700 crores. It is the largest company in women's bottom wear brands. The market share for the company currently is around 8 percent.
Gautam Saraogi, ED & CEO, Go Fashion said historically, they have grown pre-pandemic at CAGR of more than 30 percent as far as revenue is concerned. Our current market share is about 8 percent in the branded wear space, which is about Rs 4000 crore. So with this CAGR continuing not only will our market share growth, but even our addressable branded market which is at Rs 4000 crores will grow to Rs 11,000 crore.
Few years back the market share for the company was around 4-5 percent, said Saraogi.
The women's apparel market is estimated to be 36 percent of the total apparel market and of that bottom wear is just around 8 percent and Go Fashion has about 8 percent of that share. So when asked if that was too small a share, Saraogi said the women bottom where space is here to grow.
“If I take the Indian women's bottom wear space both the unorganised and organised together, it is about Rs 13,500 crore, which is going to become Rs Rs 24,000 crores by 2025 and in this Rs 13,500 crore, we are playing in a market of Rs 4000 crores with an 8 percent market share. Though percentages are misleading, if you take in terms of the number of crores, the market is very big. So we have a huge scope of growth as far as revenues, in the years to come,” he said, adding that it is one of the reasons why they see a big potential in this category and want to keep growing. When it comes to women's bottom wear all customers should think of Go Colors.
He further said, “We have excellent metrics as far as the Exclusive Brand Outlets (EBOs) are concerned because it's a low capex model, high EBIT of business. So, our CapEx is usually about Rs 18 to 24 lakhs to put up a store and our EBITDA at an EBO level is close to 30 percent. So this high throughput and EBITDA with a low capex model gives us a very strong efficient return metrics of about 18-24 months, we have a payback period as far as the stores are concerned.”
For the full interview, watch the video
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