Khaadi seeks up to Rs8.3 billion in a PSX listing next month
The fashion retailer, whose online store reaches more than 200 cities, would be the first pure play fashion retailer on the exchange. Capital spending from 2027 is aimed at larger experience stores.
Khaadi Pakistan Limited plans to raise between Rs6.2 billion and Rs8.3 billion by listing on the Pakistan Stock Exchange next month, Bloomberg reported on 1 October. TechJuice says it would be the first pure play fashion retailer on the exchange.
Khaadi is a retailer, not a technology company, but its online store reaches more than 200 cities. The listing will show how investors value a consumer brand with a large digital arm.
From a Zamzama shop
Shamoon Sultan founded Khaadi in 1998 in a 400 square foot shop in Karachi's Zamzama area. In 2022 the International Finance Corporation invested $25 million in the company, which TechJuice describes as the IFC's first global investment in fashion retail.
Half placed, half public
The offering totals 500 million shares. Half, or 250 million shares, is a pre IPO placement at Rs12.40 to Rs15.20 each, worth Rs3.1 billion to Rs3.8 billion, and those shares have already been placed with investors. The other 250 million shares will be sold to the public through book building at a price range of Rs12.40 to Rs18.00, raising Rs3.1 billion to Rs4.5 billion. Arif Habib Limited is lead manager and book runner. On 8 October the PSX asked for written comments on the draft prospectus by 15 October, and final book building dates have not been announced.
Profits and targets
Profit after tax was Rs1.4 billion in 2024, Rs1.7 billion in 2025 and Rs1.6 billion in the first half of 2026. The company targets more than Rs3.1 billion for the full year 2026 and Rs4.8 billion for 2027. In the first half of 2026 its gross margin was 37 percent and its operating margin 15 percent. On the 2026 target, the post money price to earnings multiple works out at about 10 times.
Khaadi runs 31 stores in 14 cities, of which 18 have been converted to larger experience stores, with 13 more under way. It also has outlets in the UAE, the UK and the US. Capital spending is expected to be about Rs3.5 billion a year from 2027, as the company moves away from fast geographic expansion toward fewer, larger and more productive outlets.
A busy year for listings
Finance Minister Muhammad Aurangzeb told the National SDGs Investment Fair in Karachi on 6 October that the PSX completed 11 IPOs in the last fiscal year and five in the last quarter, which the Daily Times calls the highest pace in two decades. He named Khaadi as preparing its own offering.
Farooq Tirmizi, managing editor of Profit, wrote on 12 October that the sale of only part of the company lets current owners reduce their risk while keeping a share of the upside alongside new minority investors. A good company and a good stock often overlap but occasionally diverge, he argued, and the prospectus contains intercompany dealings he views with suspicion.
