RDC Concrete is planning to go public with its initial public offering (IPO) in January 2025, valuing the manufacturer and supplier of Ready Mix Concrete (RMC) between Rs 3,500 crore to Rs 4,000 crore, the company's Managing Director and CEO Anil Banchhor told MoneyControl on January 12 in an exclusive interview.
The company, which recently opened its 100th operational manufacturing plant in the country, eyes more expansion to have a sizable market share by March 2025, amid robust demand environment from private and government-backed infrastructure projects.
Tiger Global-backed business-to-business construction material maker Infra.Market had acquired RDC in mid-20212. RMC had 49 plants at the time of acquisition.
Last month, parent Infra.Market divested around 10 percent of its stake to investors led by Ashish Kacholia for $20 million.
"We plan to increase investments by more than 30% in the next fiscal year, compared to the current fiscal year with an investment of approximately Rs 300 crore," Banchhor said adding that the funds raised through the IPO will be utilised for supporting capital expenditure.
Infra.Market had acquired RDC Concrete for $90 million in mid-2021 when it had 49 RMC plants. RDC now houses a network of 100 RMC plants, and it is poised to achieve a revenue milestone of Rs 2,500 crore by the end of the current financial year.
"We have a target to have around 120 plants by March 2024, by next financial year, we will add around 100 more plants so that we become around 220 plants by March 2025. The target is to have one client in each state and each union territory," Banchhor added.
Bullish on demand
The onset of a busy construction season and healthy pre-elections government spending are expected to bolster industry volume in Q4FY24, according to analysts, while a rising demand is likely to lend support to cement prices, further benefiting the industry.
Commenting on the demand environment, Banchhor said, "We are seeing a lot of demand coming up from metro projects. We are very bullish on road projects as well as low-cost residential projects."
"We have a mix of all customer segments, don't see any stoppage in the government projects, next 10 years I don't see any dearth in demand," he added.
When asked about consolidations in the cement industry, he said "We have seen consolidations going on; a similar trend is going on in RMC industries. We are also on the lookout for available opportunities in the market."
RDC Concrete, which is among the top ready-mix concrete companies in India, counts Larsen and Toubro, Shapoorji Pallonji, and Hiranandani Group as its customers.
(The story was edited on January 19 for a correction issued by the company on the investments plan for next fiscal. RDC earlier said it plans Rs400 crore investments next fiscal which was later corrected to 30% increase investments compared to Rs300 crore invested this fiscal.)
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