Analyzing the Shareholding Structure in ArisInfra's Draft Red Herring Prospectus (DRHP)

ArisInfra Solutions, a construction material procurement platform, is one of the Indian startups planning to go public this year. The company recently submitted its draft red herring prospectus (DRHP) to the Securities and Exchange Board of India (SEBI) for an IPO worth INR 600 crore. This IPO will consist solely of new shares being issued, with no offer for sale (OFS) component, and the shares will be listed on both the BSE and NSE.

Founded in 2021 by Ronak Morbia and Bhavik Khara, ArisInfra utilizes AI and machine learning to streamline the procurement of construction materials by connecting property developers with vendors. The platform also provides a smart financing solution for infrastructure and construction companies. The startup is backed by PharmEasy CEO Siddharth Shah and San Francisco-based Think Investments. The proceeds from the IPO will be used to repay existing debt, fund working capital, and expand investments in its subsidiary, among other purposes.

In the fiscal year 2023-24 (FY24), ArisInfra recorded an operating revenue of INR 696.8 crore, which was a 6% decline from INR 746 crore in the previous year. Its consolidated net loss increased by more than 12% year-on-year to INR 17.3 crore as of March 2024. However, the startup's losses in FY24 were largely due to a fair value loss on derivatives amounting to INR 20.55 crore. Without this, ArisInfra would have reported a net profit of INR 3.22 crore for the year.

As ArisInfra prepares for its IPO, its shareholding pattern reveals that the promoters and promoter group collectively hold over 55% of the company. Aspire Family Trust is the largest shareholder with a 12.84% stake, followed by cofounder and chairman Ronak Morbia with 11.78%. Prominent investor Kedar Mankekar holds a 10.27% stake, while US-based Think Investments and cofounder Bhavik Khara own 8.65% and 8.1% respectively. Other significant investors include Priyanka Shah Family Trust (7.81%), Siddhant Partners (6.8%), and Serenity Nest Trust (3.24%).