RELAXO FOOTWEARS

Name Roll No.

Shaaqib Mansuri PGP/24/112

Medha Kumari Jha PGP/24/098

Shalini Agarwal PGP/24/416

Industry Overview

Indian footwear market value in USD million 2016-20 Indian footwear market value forecast in USD million 2020-25

The Indian footwear market shrank by 20.3% in 2020 In 2025, the Indian footwear market is to have to have a value
to reach a value of $6,284 million. The compound of of $11,088.4 million, an increase of 76.5% since 2020. The
annual growth rate of the market in the period compound annual growth rate of the market in the period
2016–20 was 2.1%. 2020–25 is predicted to be 12%.
Industry Overview
Company Overview: Introduction

● Incorporated in 1984, Relaxo is India’s

leading footwear manufacturing company
● Over the years, Relaxo has consistently
posted superior performance, depicting the
fundamental strength of the company.
● Relaxo has a mere 8% market share in the
fragmented footwear industry in India
● We expect volume growth momentum to
come down to certain extent (owing to high
base effect) but still grow at a steady 8%
CAGR in FY19-22E
Company Overview: Timeline

1976 1984 1995 2000 2005

Launched Relaxo IPO to set up Expanded Launched

Relaxo brand Footwears a plant in capacity in ‘Flite’ and
Revenue Rs Ltd Haryana Haryana ‘Sparx’
0.12 crore incorporated Revenue: Revenue: Rs brands. First
Revenue Rs 38.17 crore 124.24 crore COCO store
1.78 crore launched

2007 2010 2012-14 2017 2018-21

Commenced Renewable Business Corporate Set up 8th

Exports power Transformati identity plant in
capacity of on Initiatives revamped Rajasthan.
Revenue: Rs 6.00 MW Revenue: Revenue Rs Revenue:
235.93 crore Revenue Rs Rs 1214.61 1651.97 Revenue Rs
553.70 Crore crore crore 2359.15 cr
Company Brands
Hawaii
It is synonymous with low cost
comfortable slippers and has earned
decades of trust making it the most
versatile footwear for all segments of
the society
Bahamas
This was launched in FY15 and
represents the spirit of the
ever-restless youth and offers a
colorful range of flip flops that exude
the spirit of freedom, fun and
modernity of youth
Flite
Fashionable & lightweight footwear
that was launched in 2005. It is a
popular range of fashionable and
semi-formal slippers for everyday
wear.
Boston
A brand that marries craft and
comfort with a masterstroke of
perfection. Boston stands for
elegance for men who are walking
towards their success, in their
professional life.
Sparx
It was launched in 2005 and is a
premium range of sports shoes and
sandals. It reflects the attitude, style,
dynamism and spirit of young India
and is endorsed by Akshay Kumar.
Mary Jane
MaryJane is the answer to every
woman’s dream of a footwear
wardrobe. Combining style and
quality, the stylish footwear makes a
woman put her best foot forward,
with panache
Revenue By Segments
Revenue Distribution based on Distribution Channels
Relaxo has, over the years, built a robust distribution network on a
pan-India basis. The products are retailed in over 50000+ touch points
through network of 650+ distributors. The company has maintained a
strong relationship with distributors through end-to-end distributor
programmes and consistent improvement of engagement levels. Relaxo
has promptly derisked its business model with a well-diversified
distribution strategy. The distribution network comprises of multi brand
outlets (MBOs), exclusive Relaxo brand outlets (EBOs), large format
stores (LFS) and e-commerce
Revenue Distribution based on Region
While the north region remains the main fortress for the company, west
and south remain relatively underpenetrated markets. Relaxo has over
the years made sturdy inroads to fortify its presence across regions
through its portfolio of brands. For instance, the Sparx brand has gained
significant traction in the south and west region in a quick span of time,
while Flite and Relaxo have a much stronger presence in the north and
east. The company has geo-tagged ~75000 outlets, which signifies an
immense opportunity to penetrate new territories through appointing
new distributors and dealers.
SWOT Analysis

Strengths Weaknesses
● High Growth
01 02 ● Poor Supply Chain
● Labour Availability ● Uneconomical

S W
● Presence of Large Raw Manufacturing Unit
Material Base Size
● Product Focus ● Intense Competition
● Market Penetration ● Large Unorganised
sector.

Threats
T O Opportunities
● Inflation ● Product Diversification
● Changing Fashion 04 03 ● Geographical
Trends Expansion
● Multinational ● E-commerce
Corporations ● Rising Domestic
● FDI Relaxation in Market Potential
Retails
KEY FINANCIALS
Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-19 Mar-20 Mar-21 CAGR

Sales 554 676 845 981 1,180 1,441 1,668 1,631 1,941 2,292 2,410 2,359 12.83%

Op. Profit 91 72 95 110 148 201 241 231 302 328 413 498 15.22%

OPM % 16% 11% 11% 11% 13% 14% 14% 14% 16% 14% 17% 21%

PBT 54 36 53 68 96 143 178 178 244 268 292 391 17.94%

Net Profit 38 27 40 45 66 103 120 120 161 175 226 292 18.52%

EPS in Rs 1.57 1.11 1.66 1.87 2.74 4.29 5.01 4.99 6.69 7.07 9.11 11.74
KEY RATIOS
Profitability 2015 2016 2017 2018 2019 2020 2021 Operating 2015 2016 2017 2018 2019 2020 2021

ROA 12.23% 12.07% 11.52% 12.89% 10.89% 12.29% 14.27% Inventory Turnover 2.62x 2.50x 2.50x 2.83x 2.80x 2.32x 2.48x

ROE 28.02% 25.06% 20.33% 21.16% 15.88% 17.78% 18.54% Fixed Asset Turnover 4.15x 4.07x 3.20x 3.44x 3.2x 2.7x 2.4x

ROCE 29.50% 31.24% 27.17% 29.10% 22.66% 20.43% 26.02% Debtors turnover 19.75x 18.02x 15.15x 13.11x 12.39x 11.28x 11.07x

NPM 6.96% 7.06% 7.10% 8.34% 7.71% 9.45% 12.15% Creditors turnover 1.76x 1.71x 1.62x 1.55x 1.41x 1.30x 1.08x

EBITDA Margin13.60% 14.20% 14.30% 15.39% 14.17% 16.76% 20.90% Working Capital Turnover 24.43x 29.81x 17.77x 13.15x 8.62x 6.33x 3.72x

Liquidity 2015 2016 2017 2018 2019 2020 2021 Leverage 2015 2016 2017 2018 2019 2020 2021

Current Ratio 1.20x 1.16x 1.28x 1.35x 1.57x 1.91x 2.40x Debt to Equity Ratio 0.65 0.49 0.29 0.20 0.10 0.02 0.09

Quick Ratio 0.37x 0.37x 0.44x 0.60x 0.74x 0.83x 1.46x Assets to Equity Ratio 2.29 2.08 1.76 1.64 1.46 1.45 1.38

Cash Ratio 0.02x 0.01x 0.01x 0.01x 0.00x 0.01x 0.02x Interest Coverage Ratio 8.72x 8.67x 13.40x 28.59x 28.98x 15.00x 24.60x
PEER COMPARISON - FINANCIAL

S.No. Name P/E Mar Cap ROCE % OPM % Sales ROA D/E EPS CR NPM Int Cov. Inv TO WC Days

1 Relaxo Footwear 119.23 34801.42 26.02 18.8 2631.26 14.27 0.09 11.75 2.33 12.15 24.59 2.48 44.11

2 Bata India 1063.62 28685.76 -0.06 15.22 2086.71 -2.34 0.1 1.84 2.48 -4.83 1.41 1.18 47.2

3 Mirza Internatio 17.43 1088.87 6.18 12.65 1335.96 0.64 0.17 5.19 1.91 0.74 3.32 1.46 138.8

4 Khadim India 43.72 506.29 -2.92 6.14 693.91 -4.62 1.17 6.44 1.18 -4.9 1.04 2.97 92.56

5 Sreeleathers 25.77 424.45 4.83 20.94 111.76 3.33 0.01 6.92 2.06 13.37 47.33 4.69 19.7

6 Liberty Shoes 28.57 287.45 5.83 11.23 519.18 0.05 0.49 5.62 1.79 0.07 1.88 1.1 163.26

7 Bhartiya Intl. 12.85 256.02 2.87 5.57 606.88 -0.68 1.29 16.33 1.61 -1.12 2.15 0.79 338.74
KEY RISKS
Increase in raw
material prices
Increase in raw material
prices would have
adverse impact in near
term

Shopping Habits
Transition from offline to
online buying

01 03
02

Intense competition
Increasing number of
foreign and domestic
players
Thank you