Ethos is one of the largest watch retailers in the Indian premium and luxury watch industry. According to the 'Industry Report on Premium and Luxury Watch Retail in India dated April 26, 2022, prepared by Technopak Advisors Private Limited', Ethos has a market share of ~13% in the Rs 6,615 crores premium & luxury watch market (FY20), enabled by the portfolio of 50 luxury brands and a pan-India retail presence, supported by omni channel and digital team capabilities.

IPO Size of Ethos

The Rs 47,228.56 lakh IPO includes Rs 37,500 lakhs fresh issue [cap price] and an OFS of 11.08 lakh shares. Following the listing, the m-cap at the cap price would be Rs 2,050.06 crores. Ethos plans to utilize the proceeds of the fresh issue to repay borrowings (Rs 2,989.09 lakhs), fund working capital (Rs 23,496.22 lakhs), finance capital expenditure for new stores/renovation of certain stores (Rs 3,327.28 lakhs), upgrade of ERP (Rs 198.01 lakhs) and the rest for general corporate purposes.

Ethos Strategy

Going ahead, Ethos' strategy is to improve assortment for existing brands as well as bring new brands to India through exclusive partnerships or otherwise, expand retail presence with 13 new stores and scale-up complimentary channels of CPO/ other luxury categories. Ethos' avg. selling price (ASP) has increased from Rs 73,261 in Fiscal 2019 to Rs 1,42,795 for the nine months period ended December 31, 2021, led by increase in mix of luxury and high luxury watch categories.
IPO price band: Rs 836 to Rs 878
Issue open date: May 18
Issue close day: May 20

Leadership position in an attractive luxury watch market

The watch market in India was valued at Rs 13,500 crores in Fiscal 2020 and is expected to grow at a CAGR of 10.6% to reach Rs 22,300 crores by Fiscal 2025 (Source: 'Industry Report on Premium and Luxury Watch Retail in India dated April 26, 2022. Ethos is the largest retailer for luxury watches in India, commanding a ~13% market share of the organized market for premium and luxury watch retail. Retailer margins on bridge to the luxury segment ranges from 25%-28%, and luxury segments have a retailer margin of 20%-35% while retailer margins on premium watches range from 20% to 25% (Source: 'Industry Report on Premium and Luxury Watch Retail in India dated April 26, 2022, prepared by Technopak Advisors Private Limited'.

(The entire content is taken from the report of Emkay Global financial Services )