Interarch Building Products’ Rs 600-crore initial public offering (IPO) received an overwhelming response, with a subscription rate of 93.53 times on the final day of bidding, August 21. Investors across all categories contributed to the high demand, purchasing 43.88 crore equity shares against the offered 46.91 lakh equity shares.
The IPO, which opened on August 19, aims to raise Rs 200 crore through a fresh issue and Rs 400.29 crore via an offer-for-sale (OFS) at the upper price band of Rs 850-900 per share.
Qualified institutional buyers led the charge, subscribing to 205.41 times their allotted portion. Non-institutional investors, including high-net-worth individuals, followed closely, with 128.42 times their quota being subscribed. Retail investors secured 19.11 times their reserved shares. Employees also showed strong interest, bidding 24.19 times their reserved quota. The company has allocated Rs 2 crore worth of equity shares for its employees, offering them at a Rs 85 per share discount to the final issue price.
Interarch, a turnkey provider of pre-engineered steel construction solutions, plans to use the net proceeds from the fresh issue to establish a new PEB manufacturing unit and upgrade its existing facilities in Kichha, Tamil Nadu I & II, and Pantnagar. Additionally, funds will be allocated for enhancing the company’s IT infrastructure, meeting incremental working capital needs, and other general corporate purposes.
The Uttar Pradesh-based company ranks as the second-largest integrated PEB player in India, with an aggregate installed capacity of 1.41 lakh metric tonnes per annum (MTPA) and a 6.5 percent market share in operating income.
Interarch Building Products will finalize the IPO share allotment basis by August 22, with successful investors receiving shares in their demat accounts by August 23. Trading of the company’s equity shares will commence on the BSE and NSE from August 26.
Ahead of the listing, Interarch IPO shares were reportedly trading at a 40 percent premium over the upper price band in the grey market, according to market observers. The grey market serves as an unofficial platform for trading IPO shares prior to their official listing.
Financially, Interarch reported a 5.9 percent increase in net profit for fiscal year 2024, reaching Rs 86.3 crore despite a weaker operating margin. Revenue from operations grew by 15.1 percent year-on-year to Rs 1,293.3 crore, while EBITDA rose 6.2 percent to Rs 113 crore, though the margin declined by 80 basis points to 8.7 percent compared to the previous year.
