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RedTape shares jumped after reports suggested the company’s founding family is exploring a potential stake sale. The buzz pushed the stock up nearly 16% intraday, before it cooled off to end the day 10% higher, snapping a three-day losing streak.
What’s the deal: a media report says the Mirza family, RedTape’s promoters, are in talks with global heavyweights Blackstone and KKR. The founders are said to be open to selling a majority stake or even a full exit, valuing the business at around $510 million.
What’s driving this: the promoters have reportedly appointed EY as their financial advisor to sound out investor interest. A PE entry could bring in fresh capital and help scale the brand further in a highly competitive footwear and apparel market.
Zoom out: India’s footwear and apparel market is expected to grow at nearly 11% annually to $21 billion by 2028. For PE firms, strong consumer brands with scale are back on the shopping list.
India’s footwear market is steadily expanding, from $20 billion in 2018 to nearly $35 billion by 2030, despite a brief COVID dip.
That growth runway is why PE firms are circling RedTape, scaling consumer brands make prime acquisition targets.
