Interarch Building Products IPO subscribed 93.53 times on final day

Interarch Building Products IPO

Interarch Building Products' Rs 600-crore initial public offering saw a bumper subscription of 93.53 times on the final day of bidding, i.e., August 21. All kinds of investors boosted the issue as they bought 43.88 crore equity shares against the offer size of 46.91 lakh equity shares.

The company intends to raise Rs 200 crore via fresh issue, and another Rs 400.29 crore through offer-for-sale (OFS), at the upper end of the price band at Rs 850-900 per share.

The IPO was launched on August 19.

Qualified institutional investors were at the forefront, buying 205.41 times the portion set aside for them. Non-institutional investors (high-networth individuals) were at the second spot, picking 128.42 times the allotted quota, followed by retail investors who bought 19.11 times their reserved portion.

Even employees showed strong participation in the issue, bidding 24.19 times their quota. The company has reserved Rs 2 crore worth of equity shares for its employees who will get those shares at a discount of Rs 85 per share to the final issue price.

The turnkey pre-engineered steel construction solutions provider is going to utilise its net fresh issue proceeds for setting up a new PEB manufacturing unit, and the upgradation of Kichha, Tamil Nadu I & II, and Pantnagar manufacturing facilities. In addition, the IPO funds will also be used for upgrading the company's existing information technology infrastructure, incremental working capital requirements, and general corporate purposes.

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The Uttar Pradesh-based company offers facilities for design and engineering, manufacturing, on-site project management capabilities for the installation and erection of pre-engineered steel buildings (PEB). It had the second largest aggregate installed capacity of 1.41 lakh metric tonnes per annum (MTPA), and a market share of 6.5 percent in terms of operating income among integrated PEB players in India.

Interarch Building Products will finalise the basis of allotment of IPO shares by August 22, and the successful investors will receive shares in their demat accounts by August 23.

The trading in its equity shares will commence on the BSE and NSE, effective August 26.

Ahead of the listing, Interarch IPO shares were available at around 40 percent premium over the upper price band, in the grey market, market observers said. The grey market is an unofficial platform for trading in IPO shares till the listing.

On the financial front, the net profit of the company for the fiscal 2024 grew by 5.9 percent to Rs 86.3 crore compared to previous year despite weak operating margin. Revenue from operations during the year increased by 15.1 percent on-year to Rs 1,293.3 crore. On the operating front, EBITDA (Earnings before interest, tax, depreciation and amortisation) in the year ended March 2024 rose 6.2 percent to Rs 113 crore but margin falling 80 bps to 8.7 percent compared to previous year.