Interarch Building Products is one of the leading turnkey pre-engineered steel construction solution providers in India with integrated facilities for design and engineering, manufacturing, on-site project management capabilities for the installation and erection of pre-engineered steel buildings ("PEB").

Interarch, an Book Built Issue amounting to ₹600.28 crores, consisting a Fresh Issue of 2.22 Lakh Shares worth ₹200.00 crores and an Offer for Sale of 4.44 Lakh Shares totaling to ₹400.28 crores. The subscription period for the Interarch IPO opens on August 19, 2024, and closes on August 21, 2024. The allotment is expected to be finalized on or about Friday, August 23, 2024, and the shares will be listed on the BSE NSE with a tentative listing date set on or about Monday, August 26, 2024.

The Share price band of Interarch IPO is set at ₹850 to ₹900 equity per share, with a minimum lot size of 16 shares. Retail investors are required to invest a minimum of ₹14,400, while the minimum investment for High-Net-Worth Individuals (HNIs) is 14 lots (224 shares), amounting to ₹201,600.

Axis Capital Limited and Ambit Private Limited are the book-running lead manager, Link Intime India Private Limited is the registrar for the Issue.

Interarch Building Products Limited IPO GMP Today
The Grey Market Premium of Interarch Building Products Limited IPO is expected in the range of ₹400 to ₹450 based on the financial performance and of the company. No real trading is done on the basis of Grey Market Premium that's why no real discovery of price can be done before the listing of shares on the stock exchange. The Grey Market Premium totally depends upon the Demand and Supply of the shares of the company in unorganized manner which is not recommended. The Grey Market Premium is mentioned for educational and informational purposes only.

Interarch Building Products Limited IPO Live Subscription Status Today
As of 01:18 PM on 21 August 2024, the Interarch Building Products Limited IPO live subscription status shows that the IPO subscribed 11.37 times on on the first day of subscription period. Check the Interarch Building Products Limited IPO Live Subscription Status Today at NSE.

Interarch Building Products Limited IPO Allotment Status
Interarch IPO allotment date is 23 August, 2024, Friday. Interarch IPO Allotment will be out on 23rd August 2024 and will be live on Registrar Website from the allotment date. Check Interarch Building Products Limited IPO Allotment Status here. Here's how you can check the allotment status:
- Navigate to the IPO allotment status page.
- Select Interarch Building Products Limited IPO from the dropdown list of IPOs.
- Enter your application number, PAN, or DP Client ID.
- Submit the details to check your allotment status.
By following either of these methods, investors can quickly determine their allotment status and proceed accordingly with their investments.

Objectives of Interarch Building Products Limited IPO
Interarch Issue Proceeds from the Fresh Issue will be utilized towards the following objects : 
1. ₹585.33 Millions is required for financing the capital expenditure towards setting up a new PEB manufacturing unit (classified as Phase 2 of their capacity development plan at the Planned Andhra Pradesh Manufacturing Facility) (“Project”); 
2. ₹192.46 Millions is required for financing the capital expenditure towards upgradation of the Kichha Manufacturing Facility, Tamil Nadu Manufacturing Facility I, Tamil Nadu Manufacturing Facility II and Pantnagar Manufacturing Facility; 
3. ₹113.92 Millions is required for funding investment in information technology (“IT”) assets for upgradation of existing information technology infrastructure of the Company; 
4. ₹550.00 Millions is required for funding incremental working capital requirements; and 
5. general corporate purposes.

Refer to Interarch Building Products Limited RHP for more details about the Company.

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About Interarch Building Products Limited

Interarch Building Products is one of the leading turnkey pre-engineered steel construction solution providers in India with integrated facilities for design and engineering, manufacturing, on-site project management capabilities for the installation and erection of pre-engineered steel buildings (“PEB”). They were ranked third in terms of operating revenue from PEB business in the Financial Year 2023 among integrated PEB players in India. The Company further had the second largest aggregate installed capacity of 141,000 metric tonnes per annum (“MTPA”) as at March 31, 2024 and a market share of 6.5% in terms of operating income in Financial Year 2024 among integrated PEB players in India. Their PEB offerings are designed, engineered and fabricated by them in accordance with customer requirements, and find use in construction for industrial, infrastructure and building (residential, commercial and non-commercial) end-use applications. They have delivered PEBs for projects ranging from multi-level warehouses for customers engaged in e-commerce to paint production lines for customers engaged in manufacturing of paints and, fast-moving consumer goods (“FMCG”) sector for setting up manufacturing units for manufacturing their products. They have also supplied large-span PEBs for indoor stadiums and customers engaged in the cement industry. During the from Financial Year 2015 to Financial Year 2024 we completed execution of 677 PEB Contracts, thereby demonstrating our extensive track record in the PEB industry.

They offer their PEBs by way of: (a) pre-engineered steel building contracts (“PEB Contracts”), wherein they provide complete PEBs on a turn-key basis to their customers, and as a part of which, they also provide on-site project management expertise for the installation and erection of PEBs supplied by them at their customers’ sites; and (b) sale of pre-engineered steel building materials (“PEB Sales”), which includes (i) sale of metal ceilings and corrugated roofing (comprising metal suspended ceiling systems (under the brand, “TRAC®”), metal roofing and cladding systems (under the brand, “TRACDEK®”) and permanent/metal decking (lost shuttering) over steel framing (under the brand, “TRACDEK® Bold-Rib”)); (ii) supply of PEB steel structures (comprising, amongst other things, primary and secondary framing systems; as well as complete PEBs, such as non-industrial PEB buildings for non-industrial use, such as farmhouses and residential buildings (under the brand, “Interarch Life”)) for erection and installation by third party builders/erectors, and (iii) light gauge framing systems (“LGFS”).

They were incorporated in 1983 and have presence of over 30 years in the PEB industry under their brands, “TRAC®” and “TRACDEK®”. As on the date of this Red Herring Prospectus, they have evolved into a turn-key PEB solutions provider, with integrated facilities for design and engineering, manufacture, and on-site project management capabilities for the installation and erection of PEBs supplied by them which enable them to deliver end-to-end solutions to their customers. They primarily manufacture their products in-house at their four manufacturing facilities ("Manufacturing Facilities”), comprising two Manufacturing Facilities in Sriperumbudur, Tamil Nadu, India (“Tamil Nadu Manufacturing Facility I” and “Tamil Nadu Manufacturing Facility II”), and one each in Pantnagar, Uttarakhand, India (“Pantnagar Manufacturing Facility”), and Kichha, Uttarakhand, India (“Kichha Manufacturing Facility”), As at March 31, 2024 their Manufacturing Facilities had an aggregate installed capacity of 141,000 MTPA.

DOMESTIC CONSTRUCTION SECTOR
CRISIL estimates, total construction investments of ₹ 46-48 trillion between Financial Years 2020- 2024 and the same is expected to increase to ₹ ~74-76 trillion between Financial Years 2025- 2029P. Construction capex is estimated to have risen by 13% on year in fiscal 2024 led by infrastructure sector. The rise is in keeping with the Govt’s focus on infrastructure as visible in rising central and state budget allocations to capex in order to meet the infra build out outlined in the NIP. Moving forward, Construction sector is projected to grow at 7-9% in Financial Year 2025 with major contribution by infrastructure sector given the rising investments and focus by central and state government capex coupled with schemes such as NIP, NMP and Gati shakti initiatives on a rising pace.

Infrastructure
Infrastructure investments are seen growing faster than the other two sectors due to the government's focus under the National Infrastructure Pipeline (NIP), National Monetization Pipeline (NMP) and the Gati Shakti initiatives. Total construction investments in this sector is expected to attract investments of ~₹51-53 trillion between Financial Years 2025-2029P, up from ₹29-31 trillion between Financial Years 2020 to 2024. This upsurge aligns with the focus on infrastructure, evident in the increased capex allocations within central and state budgets. Within the infrastructure space, road projects will be a critical investment driver from Financial Year 2025-2029. CRISIL MI&A Road's capex to increase by 80-85% over block period of Financial Years 2025-2029P as compared to FY2020-2024 due to strong pipeline of awarded and under-execution national highway projects, execution of higher value expressways and recovery in state road investments.

Additionally, CRISIL MI&A expects a 5-7% rise in investments in railways in Financial Year 2025 led by rise in budget allocation for railways, implementation of high value projects such as the Mumbai-Ahmedabad Bullet train, gaining traction in station redevelopment and completion of the freight corridor. The rise is post an expected rise of 22% CAGR rise in investments in Railways between FY21-24; owing to government focus on completion of DFC projects, traction in high speed rail, investment in newer avenues such as Vande Bharat trains and rising focus on station redevelopment program. A construction capex of ₹7.3-7.8 trillion is expected over the next 5 years compared to ₹4.5 trillion over the past 5 years led by investments in network decongestion, dedicated freight corridors and high-speed trains.

Furthermore, CRISIL MI&A expects increased investment in power, urban infrastructure as well as irrigation.

Urban infrastructure capex projected to increase by ~80% over coming five fiscal i.e. Financial Year 2025-2029 owning to central govt schemes like Jal Jeevan Mission, AMRUT, Swachh Bharat Mission to aid water supply & sanitation investments. Out of the total urban infrastructure investments, water supply & sanitation projects projected to constitute dominant share of 75-80% of the overall urban infrastructure investments.

CRISIL expects construction spending on power to rise 10-12% on year in fiscal 2025 driven by capacity additions in the renewable energy space. Significant capacity additions are anticipated in the renewable energy sector over the next five fiscal years, with projections indicating these additions will be more than three times greater than those achieved in the previous five fiscal years. This substantial increase underscores a robust shift towards renewable energy sources, driven by both technological advancements and policy support aimed at reducing carbon emissions and promoting sustainable energy. Overall, construction investment over the Financial Years 2025-2029P is projected at ~ ₹2.3-2.8 trillion, up from ₹1.6 trillion over the past Financial Years 2020-2024.

Similarly, construction capex in irrigation is expected to improve over the long term due to the low penetration of Irrigation in the country. Construction spend in irrigation is projected to rise to ₹ 5.5-6 trillion over Financial Years 2025-2029 from ₹3.8 trillion over the Financial Years 2020-2024 owing to the push from state governments to increase irrigation penetration in states.

Warehouses
Pursuant to the change of the indirect tax regime, there is a huge demand for warehouses. Additionally, the entry of several retail giants in India and increased penetration of e-commerce players is expected to lead the demand for Grade A warehousing infrastructure and upgradation of old-style warehousing into Grade A modern warehousing in India, which would contribute to the demand of pre-engineered steel structures.

Construction investments warehousing and cold storage
CRISIL projects construction investments in the warehousing (agricultural and industrial) and cold-storage (single- and multi-commodity) sectors to rise to ₹ 460-500 billion over the Financial Years 2025-2029 on expectations of increased demand. Industrial warehousing is likely to account for 85-90% of total investments. Investments in the sector of multipurpose cold storages are expected to rise due to their faster return on investment compared to single-commodity storages. The multipurpose facilities offer the advantage of accommodating various types of perishable goods simultaneously, ensuring a better capacity utilization, thereby making it a more economically viable option.

In Financial Year 2024, due to dropping vacancy levels and softening commodity prices, supply addition is expected to have gone up by 15-20% year-on-year, which would translate to addition of 43-48 MSF during the year. Over the long term, the annual demand for Grade A and B warehouses in top eight Indian cities is expected to log 10-15% CAGR between Financial Years 2024-2028. The annual supply is also expected to rise at the same rate. 

Furthermore, CRISIL MI&A also expects the warehousing industry to evolve structurally over the long term – led by automation and investment in technology and reduced dependence on labour. Most end-user industries are also expected to automate their supply chains and warehouse management services.

PEB warehouses gained prominence post GST implementation
The warehousing industry in India is fragmented with unorganised players occupying a majority share in volume terms. They have smaller reinforced cement concrete (RCC) warehouses with small shelves, build small warehouses and have an asset heavy strategy. Typically, they do not provide value-added services such as packaging, labelling, inventory management, etc.

In the pre-GST scenario, players used to prefer setting up warehouses in every state to save on inter-state taxes.

But in the past 4-5 years, the industry has started gaining traction due to implementation of GST; many large players have started investing in huge, modernised warehouses which are PEB structures. This was on account of end-user industries moving towards a hub-and-spoke model as the need to establish warehouses in each states diminishes. Larger PEB warehouses of 1,00,000-2,00,000 sq. ft are being set up as hub warehouses and smaller warehouses of 20,000-30,000 sq. ft. which would serve as the key ‘spoke’ warehouses. The PEB warehouses generally have a height of 22-24 feet (typically higher than RCC).

Realignment towards the hub-and-spoke model is expected to result in major business opportunities for organised 3PL players operating large-sized warehouses in key geographies. They not only provide huge modernised PEB storage but also warehouses equipped with racking and storage solutions, forklifts and reach trucks, and value added services. The 3PL players also have an asset light model. They take warehouses on lease from warehousing developers which, in turn, acquire the land and construct

Residential
Residential forms the largest vertical within building construction, occupying 85% as of Financial Year 2020- Financial Year 2024. The real estate industry has been facing changes and challenges with developments such as demonetisation, enactment of the Real Estate (Regulation and Development) Act, 2016 (RERA), and implementation of the Goods and Services Tax (GST). The pandemic further significantly impacted the sector in Financial Year 2021. Although Financial Year 2022 had challenges due to second wave of coronavirus, the ease of curbs in various states, increase in vaccination across the country, deferred project completions from Financial Year 2021 helped the sector to rise nearly 95-105% in Financial Year 2022, returning to pre-Covid levels and creating high base for Financial Year 2023. The increase in budgetary allocations for the PMAY scheme and announcements by state government of stamp duty cuts has helped the further sector limp back to pre-covid levels.

Commercial and social
Commercial and social sector includes educational institutions, commercial real estates and healthcare facilities. It contributed 15% of the total construction investments in building sector between Financial Years 2020-2024 and is expected to further decrease to 10-12% between Financial Years 2025-2029.

Industrial/ manufacturing sector
Construction spends across Industrial investments in Financial Year 2025 are seen rising 5-7% driven by expansion in oil and gas and metals sector. To be sure, the growth is on a high base of Financial Year 2024 where the sector grew due to deferred investments from Financial Years 2021-22 and capex investments from PLI scheme picking up. The PLI scheme is a time bound incentive scheme by the Government of India which rewards companies in the range on 5-15% of their annual revenues based on the companies meeting pre-decided targets for incremental production and/or exports and capex over a base year.

Based on an analysis of eight key sectors, CRISIL MI&A estimates construction investment in the industrial sector at ₹ 4-5 trillion between Financial Years 2025-2029, compared to ₹ 3-4 trillion spends seen in Financial Years 2020-2024. The rise in investment is projected due to inclusion of the PLI scheme in the capex investments of the industrial sector. While the PLI scheme covers 13 sectors, CRISIL have only considered 3 capex-intensive sectors, viz., auto and auto components, textiles and specialty steel for inclusion in our estimates.

Within the industrial sector, the oil and gas sector is estimated to provide 62-64% of the total industrial construction opportunities (upstream and downstream) over the five-year period. Other major contributors of the overall industrial construction spends includes automobiles and metals, which formed 12% and 16% share between Financial Years 2020-2024. Overall, industrial construction investments between Financial Years 2025-2029 is expected to be ~1.3x of the investments over Financial Years 2020-2024.

Evolution of pre-engineered steel structure market in India
Pre-engineered steel buildings were introduced in India during the late 1990s/2000s with the onset of India’s economic growth post liberalisation in 1991. However, the acceptance among consumer verticals began in early 2000 with good growth during 2005-2010. Pre-engineered steel buildings started gaining prominence following a strong fixed capital formation in India and increased adoption by the customers. This period of high growth saw new players enter the fray. With the slowdown of India’s economic growth, the Indian pre-engineered steel building industry stagnated between 2010 and 2015. Post that, the industry saw good adoption but suffered some slowdown as capex declined during the pandemic, leading to a drop in revenue in Financial Year 2021.

Market size of pre-engineered steel buildings in India and potential
The industry expanded at a CAGR of ~8.0% over Financial Years 2019-2024, growing from ₹ 130 billion in Financial Years 2019 to ₹195 billion in Financial Years 2024. The medium-term outlook is optimistic, with the industry growing at a strong 11.0-12.0% CAGR between Financial Years 2024 and 2029 to ₹ 330-340 billion, supported by investments in the industrial and infrastructure sectors, such as warehouses and logistics as well as expressways (wayside amenities and toll plazas).

Structural steel is seeing good potential and application in metro station structures, airport structures, telecommunication towers, broadcasting towers, floodlight towers, power transmission towers, among others, which is supporting growth in the pre-engineered steel buildings industry in India. The Indian government’s impetus on the infrastructure investments will also drive demand for steel construction-related structures.

INTERARCH BUILDING PRODUCTS LIMITED STRENGTHS
1. Market position and established brand presence in the growing pre-engineered steel building industry in India
2. Significantly integrated manufacturing operations, backed by in-house design and engineering, on-site project management, and sales and marketing capabilities
3. Demonstrated track record of execution backed by on-site project management capabilities
4. Diverse customer base and long-standing relationships with significant customers
5. Demonstrated financial performance and status of their order book
6. Experienced and qualified Promoters and management team

INTERARCH BUILDING PRODUCTS LIMITED STRATEGIES
1. Capitalize on industry tailwinds, including through proposed expansion and upgradation of their Manufacturing Facilities
2. Expanding geographical footprint to cater to strategic markets in India and overseas
3. Expand customer base and increase sales to existing customers
4. Continue to invest in our technology infrastructure to enhance in-house design and engineering, and manufacturing capabilities and thereby improve operational efficiencies

INTERARCH BUILDING PRODUCTS LIMITED RISK FACTORS & CONCERNS
1. Their business and profitability are substantially dependent on the availability and the cost of their raw materials and components consumed, including steel, and any disruption to the timely and adequate supply of raw materials, or volatility in the prices of raw materials may adversely impact their business, results of operations, financial condition and cash flows.
2. They derive a significant portion of their revenues from Repeat Orders which they identify as orders placed by customers or customer groups (identified as customers forming part of the same corporate group) that have placed orders with their Company previously.
3. Their business is dependent and will continue to depend on their Manufacturing Facilities and they are subject to certain risks in their manufacturing process.
4. They depend on their PEB Contracts for a significant portion of their revenues, in connection with which they also provide onsite project management for installation and erection of pre-engineered steel buildings.
5. Their Manufacturing Facilities are currently concentrated in the states of Tamil Nadu and Uttarakhand in India.
6. Their business benefits from the National Steel Policy introduced by the Government of India to boost the steel industry and withdrawal of this policy could have an adverse impact on their business, results of operations, financial condition and cash flows.