Interarch Building Products IPO: The three-day subscription window to bid for the initial public offering (IPO) of turnkey pre-engineered steel construction solution provider, Interarch Building Products, opens for public subscription today. Meanwhile, unlisted shares of Interarch Building Products are trading at a premium of around Rs 325 or 36 per cent above the upper end of the issue price, indicating positive demand for the public issue among investors.
Through this IPO, the company aims to raise Rs 600.29 crore. Interarch Building Products is offering a fresh issue of 2,222,222 shares, aggregating up to Rs 200 crore, along with an offer for sale where the company’s promoters and investors are offloading 4,447,630 equity shares with a face value of Rs 10 per share.
The public issue of Interarch Building Products is priced within a range of Rs 850 – 900 per share, with a lot size of 16 shares. Accordingly, investors can bid for a minimum of 16 shares and a maximum of 208 shares (13 lots). The minimum amount required by a retail investor to bid for the IPO is Rs 14,400.
Should You Subscribe to the Interarch Building Products IPO? Several noted brokerage firms, including Reliance Securities, Deven Choksey Research, SBI Securities, and Swastika Investmart, have shared their outlook on the initial public offering of Interarch Building Products for the investors.
Reliance Securities – Subscribe
Analysts at Reliance Securities remain optimistic about Interarch Building Products, citing rapid industrialisation, urbanisation, and the high adoption rate of advanced construction practices. They also highlighted growing investments in renewable energy, the Smart City Mission, and favorable government initiatives leading to increased overall capital expenditures in tourism, warehousing, and improved public infrastructure connectivity. These factors, they believe, will enable sustainable growth for IBPL in the coming years.
“IBPL’s domain expertise, early mover advantage in the segment, diverse customer base, and demonstrated financial performance are added strengths. Hence, we recommend subscribing to the issue,” Reliance Securities stated in its report.
Deven Choksey Research – Subscribe
Brokerage firm Deven Choksey Research also shared a positive outlook on Interarch Building Products and recommended subscribing to the IPO. The brokerage noted that Interarch is strategically positioned to capitalise on the dynamic growth of the Indian Pre-Engineered Buildings (PEB) industry, which has expanded significantly due to rising infrastructure development, industrialisation, and growing demand for efficient construction solutions. Deven Choksey believes Interarch’s strong financial performance (Revenue CAGR of 24.5 per cent, PAT CAGR of 124.4 per cent from FY22-24), marked by a growing order book and solid balance sheet, positions it well to leverage these industry trends.
“The company enjoys superior return ratios compared to its peers, with a ROE of 19 per cent and ROCE of 26 per cent. The company is expected to trade at a PE multiple of 17x based on its FY24 Adjusted EPS, making it attractively valued compared to peers. We assign a ‘Subscribe’ rating to the IPO,” Deven Choksey Research concluded in its note.
SBI Securities: Subscribe for long-term
According to SBI Securities, the company is valued at an FY24 P/E multiple of 17.4x at the upper price band based on post-issue capital. The company is raising funds to set up a new manufacturing facility, invest in upgrading existing manufacturing facilities, upgrade IT assets, and fund its working capital requirements.
“Comparing the IPO with peer companies, the stock appears to be fairly valued across different valuation and financial parameters. We recommend subscribing to the issue for a long-term investment horizon,” said the brokerage in its report.
Swastika Investmart – Subscribe
Analysts at the brokerage firm Swastika Investmart have recommended a Subscribe rating for the Interarch Building Products IPO. The brokerage noted, “Interarch Building Products has established a strong market position as a turnkey pre-engineered steel construction solutions provider. Its integrated manufacturing operations and proven execution capabilities, coupled with a diverse customer base, position the company for continued growth.”
According to the brokerage, IBPL’s financial performance has been robust, characterized by consistent topline and bottom-line expansion. “However, reliance on a limited number of third-party suppliers, absence of long-term customer agreements, and significant working capital requirements pose potential challenges,” the brokerage noted in its report.
Despite these factors, IBPL’s IPO, valued at a P/E of 15.3x, appears attractively priced to Swastika Investmart. “Considering the company’s market leadership, strong financial performance, and reasonable valuation, we recommend subscribing to the IPO,” the brokerage concluded.
Interarch Building Products IPO other key details Financials
Interarch Building Products’ revenue from operations increased from Rs 834.94 crore in FY22 to Rs 1,293.30 crore in FY24, representing a CAGR of 24.46 per cent, according to the RHP papers. The company’s profit after tax rose to Rs 86.26 crore in FY24, up from Rs 81.46 crore in FY23 and Rs 17.13 crore in FY22.
Allotment, listing date
The basis of allotment for Interarch Building Products IPO shares is likely to take place on Thursday, August 22, 2024. Subsequently, the company’s shares are expected to be credited to demat accounts on Friday, August 23, 2024.
Interarch Building Products shares are expected to list on the BSE and NSE on August 21, 2024.
About Interarch Building Products
Interarch Building Products Limited is one of India’s leading turnkey pre-engineered steel construction solution providers, with integrated facilities for design and engineering, manufacturing, and onsite project management for the installation and erection of pre-engineered steel buildings.
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