Capital Calls: German fashion IPO is surprisingly reasonable - Reuters

Clothes are pictured in Munich, Germany, March 8, 2021. REUTERS/Andreas Gebert

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ALL ABOUT THE MONEY. German online fashion group About You is serving up that rarest of things: a reasonably priced technology initial public offering. The company on Thursday said it was eyeing a Frankfurt listing. The float might value it at 3 billion euros, Reuters reported .

The business has two parts. First is selling clothes and accessories to young, trendy customers via a smartphone app. Second, it also outsources technology to other fashion brands, allowing them to run their own online shops. Revenue in the year to February grew by 57% to 1.2 billion euros, and the company is hoping to grow by another 50% in the current financial year.

On that basis, it looks cheap. German rival Zalando (ZALG.DE) and Britain’s THG (THG.L) on average trade at 2.8 times forward sales. That would imply a fair value of almost 5 billion euros for About You. It’s also growing at a faster rate than the others. For investors, it may be a gem hiding in the bargain bin. (By Karen Kwok)

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