categories

HOT TOPICS

Indian Unicorns 2022: Infra.Market Tackles India’s Construction Sector

Posted on Tuesday, Jan 11th 2022

The Indian construction market is expected to grow at 11% CAGR from 2021 through 2026 as rapidly evolving technology is redefining how construction business is conducted and managed in India. Infra.Market is an Indian unicorn that is disrupting the construction industry in the country.

Infra.Market’s Offerings

Founded in 2016 by Aaditya Sharda and Souvik Sengupta, Thane-based Infra.Market is an online procurement marketplace created to assist the real estate and construction materials industry. Aaditya had already spent 10 years in the field of infrastructure and construction in India and realized that the construction sector in India was highly unorganized. He joined hands with his friend Souvik in 2016 to set up Infra.Market as an end-to-end construction solutions startup.

Infra.Market has taken the entire procurement process for the construction industry online, bringing about transparency in pricing while ensuring quality. While building the company, the founders realized that though steel and cement were widely available across India, they accounted for a modest 15% of the raw material required for a construction project. The remaining 85% of materials came from an industry that was plagued with supply chain issues and was highly fragmented and unorganized.

Its centralized platform leverages technology to combine client demands, matching them with the supply chain in addition to affordable credit options and efficient delivery tracking facility to provide clients with fair pricing and an enhanced technology experience. It operates as a B2B e-commerce player that ties up with contract manufacturers, gets them to utilize idle capacity, and manufacture products under its own brand, which it then sells to large infrastructure companies and retail outlets.

It has launched its flagship products as well and is following a dual model of opening franchise stores to cater to small stores and dealership stores for retail customers. The company now has over 300 stores and plans to open another 200 soon. It has expanded its presence internationally as well and receives 15% of its sales from overseas markets such as Dubai, Singapore, and Jordan. It has also been looking at growth through acquisitions.

Recently, it announced the acquisition of Hyderabad-based Equiphunt for $10 million. Founded in 2016, Equiphunt is present in over 25 cities across India. It is a one-stop solution provider for equipment and service requirements for its B2B customers. It relies on its in-house Internet of Things and telematics platform for improved utilization of machinery and enhancing scalability in operations. The acquisition will allow Infra.Market to build and scale its equipment rental business.

Earlier last year, Infra.Market had acquired a 100% stake in private equity-owned RDC Concrete for an estimated INR 730 crores (~$100 million). RDC Concrete is the largest non-cement-ready mix concrete company in India. It manufactures and supplies Ready Mix Concrete (RMC) and counts construction companies, real estate developers, contractors, infrastructure companies, road projects, Industrial Projects, and Commercial Projects as its clients. Concrete was among the first product categories that Infra.Market had ventured in. The acquisition will help it become a market leader in the category.

Infra.Market’s Financials

Infra.Market has reported a 5.5x growth in revenues in fiscal 2020 to INR 350 crores (~$47 million) with an increase of 4.9x in profit margins. For fiscal 2021, the company had forecast revenues of over $1 billion with an EBITDA of $70 million.  

The company has raised $326.6 million in 10 rounds of funding led by Dalmia Group Holdings, Phoenix Mills, Avendus Capital, Tiger Global Management, Alteria Capital, Sistema Asia Capital, Nexus Venture Partners, Accel, and Evolvence India Fund. Its most recent round was held in December 2021 where it raised $200 million at a valuation of over $4 billion. The company’s valuation has skyrocketed in the past year alone. It had joined the Unicorn club in March 2021 and had seen its valuation soar to $2.5 billion in August.

Infra.Market is not the only player in this space. It competes with others like Zetwerk, OfBusiness and Moglix, all of whom are also members of the unicorn club. Infra.Market believes that the construction industry market in India is big enough for all these players. It counts its improved supply chain processes as the biggest differentiating factor in the market.

I agree that the Indian construction industry is large enough to support multiple Unicorns. If Infra.Market’s revenues and earnings come in as per their estimates, their valuation seems legitimate.

Photo Credit: joffi from Pixabay

This segment is a part in the series : Indian Unicorns 2022

Hacker News
() Comments

Featured Videos