Metro Brands sprints past peers

For most of the key listed footwear companies, 2023 may not be a walk to remember. Stock returns show varied movements, with Bata India Ltd and Relaxo Footwears Ltd shares down 1-2%. Campus Activewear Ltd is a laggard, having slumped by 31%.

- Vineetha Sampath

However, Metro Brands Ltd is on a solid footing rising almost 50% so far in 2023. Company-specific positives have aided Metro Brands to be an outlier. But one important factor that explains the disparity in stock performance is that Metro Brands has reaped higher benefits from the ongoing premiumization trend.

Metro caters to the premium portfolio in the footwear segment, where the consumers are less price sensitive. Products with price range above ₹3,001 contributed 48% to Metro’s revenue in the first half of FY24. As such, the average selling price in this period stood at ₹2,200 per pair while that of Campus was ₹648 per pair.

Analysts at ICICI Securities recently met the management of Metro and gathered that the premium price point, above ₹3,000 continued to outperform.