Infra.Market Buys Majority Share in Metro Group, Expands Tile Segment

Building materials platform Infra, which is set to go public. MarketInfra. According to the company’s filings with the Ministry of Corporate Affairs, Market has acquired a majority stake in ceramic tile manufacturer Metro Group through a share swap deal valued at INR 200 Cr.

Infra.Market, established in 2016 by Aaditya Sharda and Souvik Sengupta, serves as a marketplace for construction materials.  Additionally, it produces building materials using its own private label brands.  It sells via its B2B, retail, and B2C networks while using technology to digitize the procurement process.

It offers a range of products, including ready-mix concrete, tiles, and paints, under brands such as RDC Concrete, Million Tiles, and Shalimar Paints.

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As per sources familiar with the development, Infra.Market, the unicorn, aims to bolster its position in the tiles sector through this action.

This new development occurs nearly a year after Infra.Market obtained a 57% ownership interest in Emcer Tiles.  This year, Infra.Market asserted that it has become the second-largest player in India’s ceramics industry, boasting a manufacturing capacity across 19 units and three tile brands in its portfolio.

Hella Infra Market Ltd, a company based in Thane, has been focusing on acquisitions to strengthen its product offerings.  In 2021, it acquired RDC Concrete for INR 730 Cr and subsequently purchased a stake in Shalimar Paints in 2022.

In terms of finances, Infra.Market’s net profit for FY24 soared by 144%, reaching INR 378 Cr compared to INR 155 Cr in FY23. 

In FY24, revenue increased by 23% year-on-year, reaching INR 14,530 Cr.  More than 80% of its total revenue is generated from its B2B products.

As it prepares for an IPO worth between $500 million and $700 million, the company has been investigating different fundraising options, which include a combination of equity and debt investments.

The company has secured more than $170 million this year, despite having cash and cash equivalents amounting to INR 275.1 crore in FY24.  This year’s infusion consists of $50 million in debt funding from Mars Growth Capital and $121 million from existing investors such as Tiger Global, Foundamental, and Evolvence.

Last month, the credit rating agency India Ratings raised concerns about Infra. The market’s significant reliance on debt refinancing, liquidity pressures, operational negative cash flow in FY25, and stretched receivables at its Singapore subsidiary.  Consequently, it reduced the company’s rating to BBB+ while assigning a Negative Outlook.

Infra.Market explained to investors that the rating agency had not fully considered its improving financials, recent equity infusions, and upcoming liquidity events, including the IPO.