FY22 key performance highlights:
- Total revenue from operations grew 5X to Rs 6,236 crore in FY22 from Rs 1,242 crore in FY21
- EBIDTA grew 6X to Rs 410 crore in FY22 from Rs 69 crore in FY21
- Net Profit After Tax increased to Rs 186 crore in FY22 from Rs 36 crore in the previous year.
Commenting on the FY22 results, Souvik Sengupta, Co-Founder, Infra.Market said, “Our results speak for themselves, growth coupled with profitability is the need of the hour and something we have always believed in, but most importantly, the need to build business models with deep fundamentals which can withstand cycles and funding winters. Our growth is further aided by the economic push for infrastructure growth by the government and the renewed focus to make India a manufacturing hub for the world.”
Aaditya Sharda, Co-Founder, Infra.Market stated, “We are insulated from geographical risk due to our ability to focus on cross-border opportunities. We have also gone beyond B2B, focused on retail and B2C opportunities and built our own private labelled brands to ensure we are not subject to only distribution opportunities. The launch of private labels has helped us grow our margins and differentiates us from other platforms. Our ability to also scale across industries, such as from construction materials to chemicals, also ensures that we are always looking at new opportunities for growth. Our focus during the year will be to grow our retail and private labelled businesses at a faster pace. We also will focus on building a layer of service in our business and transform into a construction solutions company from merely a material platform, our acquisition of Equiphunt, an equipment rental platform, is just a start of the journey. We have also backward integrated into manufacturing through the acquisition of companies like RDC Concrete and Shalimar Paints. This will help us unlock true value and margins in the years to come.”
Growth supported by improving profitability
The company’s revenue grew from Rs 1243 crore in Financial Year 2021 to 6236 crore in Financial Year 2022. The growth was supported by improving profit margins as the company posted operating profits (EBITDA) of Rs 410 crore for the year, 6X growth over last year (EBITDA for FY21 was at Rs 69 crore). The EBITDA Margins saw substantial improvement as it increased from 5.5% in FY21 to 6.6% in FY22.
The profit after tax for the company increased to Rs 186 crore in FY22 from Rs 36 crore in FY21. The development has been driven by the company’s ability to scale its business across product categories and geographies. It is currently present across 20 states in India and has also recently set up its global offices in Singapore and Dubai.
One of the key aspects is the company’s ability to enjoy substantially improving profitability margins with the growing share of private labelled brands on the platform. Infra.Market has large private labelled brands in concrete, walling products, chemicals, paint, electricals, and tiles. Private labelled brands constitute almost 60% of the overall revenue from the sale of construction material products.
The company embarked upon two acquisitions to strengthen its private labelled play. It acquired a concrete manufacturing company, RDC Concrete, from Truenorth for 700 crore. It marked its foray into the Industrial and Decorative Paints vertical through the acquisition of a strategic stake in a listed entity Shalimar Paints. This enabled it to get a jumpstart in the highly lucrative paint market in India.
In 2020, the company commenced its retail venture to broaden its business beyond B2B. Thereafter, in FY22, it grew its retail business by 5X, which now represents 10% of the overall revenue of the company. The company services retail outlets and helps them procure a variety of construction material products, from Concrete to Modular Furniture. It creates value for retailers by equipping them with digital catalogues and enabling them to service a broader range of products to their end customers without spending more on warehousing and logistics.
The company has also launched its experiential franchise outlets with the availability of the best of Architects, Brands and a wide range of products which can all be accessed under one roof, solving a lot of hassles for both a consumer and an architect or interior designer. The company already has 12 active franchise outlets across Tier II cities in India and plans to scale this up to 50 Stores by March 2023.
While the retail business is still not profitable, it has turned EBITDA positive during the financial year.
In the midst of Covid, when the global supply chains were disrupted, Infra.Market encashed on an opportunity to fulfill global demand by working with Indian manufacturers. This further got emboldened by the steps taken by the Indian government to enable India to become a manufacturing hub. Today the company’s export business represents more than 20% of the operational revenues, and it continues to be a large focus of growth for the company. Additionally, the company has recently set up its global offices in Singapore and Dubai to specifically focus on export opportunities.
Embarking on a new venture
During the last year, the company has ventured into a new business vertical focusing on creating a platform for speciality chemicals under the brand Chemical.Market, which has gone on to represent a sizeable portion of the overall business of the company. Through its chemical platform, the company intends to create an impact in the $200 billion chemical industry as it has done in the construction industry.
Building a layer of service
In its attempt to build out India’s largest construction solutions platform, the company also embarked on a vision to build a layer of service on top of a strong material brand already created. The company acquired the equipment rental platform Equiphunt, which runs a fully integrated Equipment Solutions Platform with complete solutions geared towards Equipment Ownership, Maintenance & Utilization.