Interarch Building Products shares drop 7% post listing

The listing was above expectations, with shares previously trading at a grey market premium (GMP) of 36% to the issue price.

"Interarch Building Products made a strong debut on the stock market, driven by the company's established market position, integrated manufacturing capabilities, and consistent financial growth," said Shivani Nyati, Head of Wealth at Swastika Investmart. Nyati also suggested that those holding the stock for the long term keep a stop-loss at Rs 1,200.


Hashim Yacoobali, Director at South Gujarat Shares and Sharebrokers, noted, "The resistance zone is between 1369 and 1385. Fresh upward momentum is expected only if this zone is surpassed. The major support zone is between 1219 and 1190, which should sustain a bullish trend. We anticipate further upward movement towards a target range of 1568 to 1729."

The IPO, consisting of a fresh issue worth Rs 200 crore and an offer for sale (OFS) of up to 44.48 lakh shares, received overwhelming interest with an overall subscription of 93.5 times. The demand was strong among both non-institutional and institutional investors.

The proceeds from the fresh issue will be utilized as follows: Rs 58.53 crore for financing capital expenditure towards setting up a new project, Rs 19.25 crore for upgrading various manufacturing facilities, Rs 11.39 crore for investment in information technology assets, and Rs 55 crore for funding incremental working capital requirements and general corporate purposes.

Interarch Building Products, incorporated in 1983, has evolved into a turn-key provider of Pre-Engineered Building (PEB) solutions. The company offers integrated facilities for design and engineering, manufacturing, and on-site project management for the installation and erection of PEBs, enabling it to deliver comprehensive solutions to its customers.

For fiscal year 2024, the company's revenue from operations increased to Rs 1,293 crore, up from Rs 1,123 crore in the previous year. This growth is attributed to increased revenue from pre-engineered building contracts and product sales, driven by expanded sales and marketing efforts in West Bengal and Telangana, as well as diversification into new sectors.

Profit after tax rose from Rs 81.46 crore in FY2023 to Rs 86.26 crore in FY2024. As of March 2024, Interarch Building Products' order book stood at Rs 1,153 crore.

(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)