Construction materials provider ArisInfra Solutions files draft papers with SEBI for Rs 600-crore IPO

Construction materials provider ArisInfra Solutions files draft papers with SEBI for Rs 600-crore IPO

Technology-enabled construction materials provider ArisInfra Solutions has filed draft red herring prospectus with the capital markets regulator SEBI to raise Rs 600 crore via initial public offering.

The IPO consists of entirely fresh issue by the company with no offer-for-sale component.

The Mumbai-based company may also consider raising Rs 120 crore in a pre-IPO placement, before the filing of the Red Herring Prospectus with the Registrar of Companies (ROC). If the pre-IPO placement is completed, the said amount will be reduced from the public issue.

Its network increased from 431 customers and 441 vendors in March 2022 to 2,133 customers and 1,458 vendors as of March 2024. It leverages the said network of vendors to source construction materials and provide them to real estate and infrastructure developers and contractors.

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Between April 2021 and March 2024, it has delivered 10.35 million metric tonnes of construction materials, including aggregates, ready-mix concrete, steel, cement, construction chemicals and walling solutions.

ArisInfra, which operates one-stop solution for all the construction material requirements, will utilise Rs 204.6 crore out of the IPO proceeds for repaying debt. Post issue, the debt burden seems to be reducing significantly as the total debt on its books stood at Rs 268.5 crore as of May 2024.

Further, the company will spend Rs 177 crore for its working capital requirements, Rs 48 crore for the subsidiary Buildmex-Infra's working capital requirements. It will utilise Rs 20.4 crore for purchase of partial shareholding from existing shareholders of its subsidiary, ArisUnitern Re Solutions, and the remaining funds for general corporate purposes and unidentified inorganic acquisitions.

Promoters hold 55.97 percent stake in the company and the remaining 44.03 percent shares are owned by the public shareholders.

However, the financial performance of the company was weak in the past years as it recorded net loss of Rs 17.3 crore for the year ended March 2024, widening from the loss of Rs 15.4 crore in the previous year. Even the revenue from operations during the fiscal 2024 dropped to Rs 696.8 crore, from Rs 746 crore in the previous fiscal.

JM Financial, IIFL Securities, and Nuvama Wealth Management are appointed as the merchant bankers for the issue.