Metro Brands: In the wake of the company’s announcement on Wednesday of a strategic alliance with New York-based specialty athletic retailer Foot Locker, Inc., Metro Brands’ share price surged over 9% to reach a 52-week high on Thursday’s trading. On the BSE, Metro Brands’ shares began trading at ₹1,371.50 each. The share price of Metro Brands Ltd. saw an intraday high of ₹1,440.45 and a low of ₹1,366.80 today.
Lead Research Analyst at 5paisa Ruchit Jain claims that shares of brands have been developing a higher top higher bottom pattern. There is a favorable short-term trend, with support levels between ₹1,200 and ₹1,300.
According to Foot Locker’s exchange filing, the business has signed a long-term licensing agreement with both Metro Brands and Nykaa Fashion. Indian sneakerheads will have access to the largest selection of foreign sportswear and footwear thanks to this partnership.
Metro Brands soars 9% to 52-week high with Foot Locker deal.
Under the agreements, Metro Brands has been given the only authority to own and operate Foot Locker locations in India as well as to sell authorized products there. Nykaa Fashion, the exclusive e-commerce partner, will manage Foot Locker’s India website and provide approved products via a Foot Locker-branded store on Nykaa’s current e-commerce platforms.
Our goal at Metro Brands is to provide our customers’ whole shoe wardrobe by introducing the best international brands to India. A significant step in that direction is this alliance. Nissan Joseph, CEO of Metro Brands Ltd., added, It will also help us pave the way in revolutionizing the sneaker market, improving the retail experience, and meeting the dynamic needs of our customers.
The Foot Locker connection with the domestic brokerage Nuvama Institutional Equities adds value, especially considering Metro’s past performance and relationship with Crocs. Additionally, Metro is excellent at high-end retail, which is what Foot Locker is.
Secondly, in terms of brokerage, there aren’t many forms that can be found in India that are similar to what Foot Locker offers.
The third is the growth of the market for sports and sneaker footwear. The brokerage expects Metro to understand that unit economics are still in the early stages of development. In contrast, the brokerage believes that this structure has the ability to expand stores by a minimum of 200, which is now the size of Crocs.
We increased our target multiple to 55x (Q3FY26) with a revised target price of ₹1,304 (previous target price of ₹1,142) in order to account for the opportunity. Maintain the hold rating. Additional value may be possible, but it will depend on how the tie-up is clarified, the brokerage stated.
