Summary:

  • Since its inception in 2016 by Souvik Sengupta and Aaditya Sharda, Infra.Market has emerged as a key player in India’s construction ecosystem

  • Infra.Market facing competition from players such as OfBusiness, Moglix, Zetwerk, and MetalBook.

  • Infra.Market has so far raised around $540 million through a combination of equity and debt funding

Infra.Market, a prominent platform offering construction goods and services, is in the midst of raising up to Rs 150 crore (approximately $18 million) in its Series E2 funding round. This development comes just three months after the company successfully secured $50 million from the Mars Fund, a sign of its steady and growing appeal to investors.

According to regulatory filings accessed from the Registrar of Companies (RoC), the company’s board has approved a resolution to issue 7,028 Series E2 preference shares, priced at Rs 213,438.7 each, to raise the Rs 150 crore sum. This move underscores Infra.Market’s ambitions to strengthen its financial position as it scales its operations and prepares for its next strategic move, which is widely speculated to be an Initial Public Offering (IPO).

Of the total Rs 150 crore planned to be raised, the company has already secured Rs 76.3 crore. A significant portion of this, Rs 45 crore, has been contributed by investors Amit Vijaysinh Barad and Barad Sanjay Amarsinh, with the remainder coming from various individual shareholders. This signals a healthy interest from individual and institutional investors alike, contributing to Infra.Market’s financial stability as it continues to grow in the highly competitive construction materials industry.

In addition to its equity funding efforts, Infra.Market has also bolstered its resources by securing Rs 75 crore (around $9 million) in debt funding from Innoven Capital, a prominent debt provider to startups and growth-stage companies. This follows the company’s recent closure of a Rs 150 crore debt round through Yubi in July. The combination of debt and equity financing indicates that Infra.The market is strategically diversifying its funding sources to ensure it has the necessary capital to continue expanding its operations and maintaining a competitive edge.

 Infra.Market as one of the leading players in the construction materials sector, particularly in India, where infrastructure growth is a key driver of economic activity. The funding is expected to be part of a larger round, which could ultimately raise between $150 million and $200 million.

As Infra.Market eyes this larger round, the company is also said to be gearing up for its IPO, with industry insiders suggesting it could file its draft red herring prospectus (DRHP) soon. This would mark a significant milestone in the company’s journey, enabling it to access public markets and further fuel its growth trajectory.

Since its inception in 2016 by Souvik Sengupta and Aaditya Sharda, Infra.Market has emerged as a key player in India’s construction ecosystem. The company specializes in selling construction materials, infrastructure goods, and technical equipment. By focusing on the burgeoning infrastructure sector, Infra.Market is tapping into a significant market opportunity, driven by increased government spending on infrastructure projects and the private sector’s demand for efficient construction solutions.

Infra.Market has so far raised around $540 million through a combination of equity and debt funding. Major investors include Tiger Global, which remains the largest external stakeholder, followed by other notable names such as Accel and Nexus Ventures. The continued interest from such prominent venture capital firms highlights Infra.Market’s potential to disrupt and lead the construction goods industry.

Despite the company’s rapid growth, Infra.Market has faced some profitability challenges. While the company experienced an impressive 89% increase in gross revenue, reaching Rs 11,846 crore in FY23, its profit slipped by 17% to Rs 155 crore during the same period. The decline in profitability, though a concern, is not uncommon for companies at this stage of growth, especially those prioritizing expansion and market share acquisition over short-term profits. As Infra.Market scales, it will need to strike a balance between growing its top line and maintaining healthy profit margins.

The construction materials market is highly competitive, with Infra.Market facing competition from players such as OfBusiness, Moglix, Zetwerk, and MetalBook. OfBusiness, another well-established player in the space, is also eyeing a public listing in the next fiscal year, adding to the competitive dynamics in this sector.

In conclusion, Infra.Market’s latest funding round, its preparation for a potential IPO, and its focus on the infrastructure sector highlight the company’s ambitious growth plans. With strong investor backing, a rapidly growing market, and a strategic focus on scaling, Infra.Market appears well-positioned to capitalize on the opportunities in India’s infrastructure and construction sectors. However, the company will need to carefully manage profitability as it continues to expand and compete with other major players in the market.