Interarch Building Products IPO to open for subscription on August 19: Check out 10 key things from RHP before investing

In advance of its impending initial public offering (IPO), which is scheduled to open for subscription on August 19, Interarch Building Products Ltd,a pioneer in turnkey pre-engineered steel building solutions with headquarters in Noida, has established a price bandof ₹850-900 per share. August 16 is the opening date of the anchor book, and August 21 is the closing date of the IPO.

An offer for sale (OFS) of up to 44.48 lakh shares by current promoters and shareholders is included in the offering, coupled with a fresh issuance of shares valued at ₹200 crore. According to the top pricing band, the OFS is worth about ₹400 crore.

The net proceeds of the new issuance will go toward general company objectives, technology enhancements, and capital expenditures.

The book running lead managers are Ambit Private Limited and Axis Capital Limited, while the offer registrar is Link Intime India Private Limited.

Here are 10 key things from the Red Herring Prospectus (RHP) that investors might want to know before subscribing to the issue.

Interarch Building Products IPO Promoters

The company's promoters are Arvind Nanda, Viraj Nanda, Gautam Suri, and Ishaan Suri. 10,913,092 equity shares, or 75.71% of the issued, subscribed, and paid-up share capital of their company, are held jointly by the promoters.

Interarch Building Products IPO Peers

The company's listed peers are Everest Industries Ltd (with a P/E of 105.95), and Pennar Industries Ltd (with a P/E of 25.16).

Interarch Building Products Business

According to the CRISIL Report, the company is one of the top turnkey providers of pre-engineered steel construction solutions in India, with integrated facilities for manufacturing, design and engineering, and on-site project management capabilities for the assembly and construction of pre-engineered steel buildings (PEB).

Among integrated PEB competitors in India, the company is placed third in terms of operating revenue from PEB business for the financial year 2023. Furthermore, as of March 31, 2024, the firm has the second-largest aggregate installed capacity in India, with 141,000 metric tonnes per year (MTPA). Among integrated PEB companies in India, it held a 6.5% market share in terms of operating revenue for the financial year 2024.

Interarch Building Products Industry

According to the CRISIL Report, the PEB industry in India is predicted to grow at a CAGR of 11–12% between Financial Year 2024 and Financial Year 2029. They are well-positioned to benefit from this growth thanks to their extensive track record, domain experience, established brand presence, and market position, as well as their in-house design and engineering, manufacturing, supply, and onsite project management capabilities for the installation and erection of PEBs that they supply.

Interarch Building Products Manufacturing Facility

The company primarily produces its goods internally at its four manufacturing facilities, which are located in Pantnagar, Uttarakhand, India ("Pantnagar Manufacturing Facility"), Kichha, Uttarakhand, India ("Kichha Manufacturing Facility"), and two other locations in Sriperumbudur, Tamil Nadu, India ("Tamil Nadu Manufacturing Facility I" and "Tamil Nadu Manufacturing Facility II"). As of March 31, 2024, our manufacturing facilities had an installed capacity of 141,000 MTPA.

Interarch Building Products Customers

Customers of the business under the industrial/manufacturing construction category include Addverb Technologies Limited, Timken India Limited, Berger Paints India Limited, Grasim Industries Limited, and manufacturers of air conditioners. Under the infrastructure construction category, customers include a logistics and warehousing service provider.

Interarch Building Products Group Companies

The firms group companies are Taipan Associates Private Ltd, and Aries Developers LLP.

Interarch Building Products IPO Key Risks

• The availability and cost of the raw materials and components used by the company, including steel, are crucial to its operations and profitability. Any disruption in the timely and sufficient supply of raw materials, or volatility in raw material prices, could have a negative effect on the company's operations, financial situation, and cash flows.
• Their business, future prospects, financial performance, and cash flows might all suffer if they underutilise their current production capacity and are unable to properly employ their additional manufacturing capacity.

Interarch Building Products Financials

Between March 31, 2024, and March 31, 2023, Interarch Building Products Limited's profit after tax (PAT) climbed by 6% and its revenue by 15%, respectively, during the financial year.

Lock-in of equity shares allotted to anchor investors

A 90-day lock-in period applies to 50% of the equity shares allotted to anchor investors under the anchor investor category, and a 30-day lock-in period applies to the remaining 50% of the equity shares allotted to anchor investors under the anchor investor category.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.