Infra.Market to open 100 franchise stores by March 2024
Aaditya Sharda, co-founder of construction material marketplace Infra.market, has said the company has signed up 35 franchise stores across Maharashtra, Karnataka and Telangana with a plan to expand the retail store network to 100 stores by March 2024.
In an interaction with businessline, Sharda said these stores will be typically 10,000 to 15,000 square feet in size and will host products from Infra.Market’s private brands along with other brands.
Started as a B2B marketplace, Infra.Market has started investing in building brand awareness as the company is of the belief that this strategy will help in boosting its B2B sales.
“Unless you don’t make the brand in B2C, you cannot get the sale in B2B. So that’s a reason we have taken a very conscious choice to start creating brands around B2C level so that the demand in B2B increases,” said Sharda.
He further said that B2C segment is relatively new and B2B still contributes around 65 to 70 per cent to Infra.Market’s revenue.
Infra.Market depends on a network of SMEs to fulfill demand for construction materials such as tiles, electricals, sanitaryware, walling solutions and steel. The company has partnered with projects like Chennai Metro, Delhi Metro, Mumbai Metro and NHAI among others.
While the company does not have its own manufacturing plant currently, Sharda believes that in categories like steel, the company has to come up with its own facility. This will help the company in maintaining deeper control on manufacturing from a quality control angle.
Infra.Market reported ₹6,236 crore in revenue for FY22, which is 5x growth over the previous year. Further, its operating profitability (EBITDA) grew 6x from ₹69 crore to ₹410 crore and it’s net profit after tax increased to ₹186 crore in FY22 from ₹36 crore in the previous year.
In March, Infra.Market was under scrutiny by tax authorities for alleged tax evasion to the tune of ₹400 crore. The authorities said that they have found evidence of bogus purchases, huge unaccounted cash expenditure and accommodation entries at the company.
To this, Sharda said, ”We’re complying with the tax authorities and as of today we have nothing overdue to be paid. Certain findings are still under investigation for which we are complying with the tax authority and I think ones that is settled, we’ll have more to share.”
Post the income tax raid, Sharda said the company has appointed experienced professionals from the industry to head its finance department.
“We have got independent auditors and are also moving to Microsoft 365. There is a series of activities that we have started to avoid such kind of situation, ,” he added.
On IPO plans, he said the company will not consider it at least before 2026. He says reaching the $100 million EBITDA mark will be a good time to go for an IPO.