Latest news with #Esops
Economic Times
a day ago
- Business
- Economic Times
ArisInfra Solutions plans Rs 499.6 crore IPO to repay debt and boost working capital
ArisInfra Solutions, a B2B platform for construction materials, is planning an IPO. The company aims to raise ₹499.6 crore. The funds will be used to repay debt and for working capital. Revenue has grown, and the company reported profit recently. However, longer collection times and client concentration are concerns. Investors may consider tracking performance post-listing. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads ET Intelligence Group: ArisInfra Solutions, a business-to-business (B2B) platform that helps construction and infrastructure companies buy materials, plans to raise ₹499.6 crore through fresh equity to repay debt and meet working capital promoter group's stake will fall to 38% after the IPO from 58%. The company has shown traction in revenue over the past three years and posted profit in nine months to December 2024 after widening losses for the past two time taken to collect outstanding sales has increased, which has raised working capital requirements. Also, top five customers contribute about 42% to the revenue, reflecting client concentration. Given these factors, investors may wait and track the company's performance after in 2021, ArisInfra focuses on simplifying and digitising the procurement process for construction materials including aggregates, steel, cement, and other materials. Between April 2021 and December 2024, it has served 2,659 customers across 1,075 pincodes in cities including Mumbai, Bengaluru and Chennai. The company provides value-added services, such as advisory, consultancy, marketing and sales support through its arm ArisUnitern Re grew by 24% annually to ₹696.8 crore in FY24 from ₹452.3 crore in FY22 while net loss widened to ₹17.3 crore from ₹6.5 crore. For the nine-month period ended December 2024, revenue and net profit were ₹546.5 crore and ₹6.5 crore, adjusting for non-cash expenses such as fair value change on derivatives and employee share-based payment expenses (Esops), Ebitda stood at ₹45.2 crore in nine months ended December 2024 from ₹7.2 crore in FY22. Adjusted operating margin improved to 8.3% from 1.6% in the same period. Net debt increased to ₹256.2 crore from ₹132.2 crore by similar comparison. It plans to repay ₹204.6 crore of debt through IPO profitability is expected to improve after repayment of debt since it would reduce interest outgo, which formed 70.6% of the operating profit (EBIT) as of December 2024 compared with 90% in FY24. Trade receivables days increased to 139 days in nine months ended December 2024 from 137 days in company has turned profitable for nine-month period of FY25; however, high interest outgo has limited the extent of profitability. As a result, considering the post-IPO equity and annualised net profit for the nine months to December 2024 the price-to-earnings multiple of 207 looks skewed. On a price-to-sales basis, the multiple works out to be 2.5.
Mint
a day ago
- Business
- Mint
Mint Explainer: What did Sebi decide at its 210th board meeting?
In his second board meeting as chairperson of the Securities and Exchange Board of India (Sebi), Tuhin Kanta Pandey approved a sweeping set of regulatory changes aimed at reducing friction across capital markets. With reforms for startups and PSU delisting norms, tweaks to the structures of alternative investment funds (AIFs) and angel funds, and easier procedures for intermediaries, the regulator moved decisively to bolster its 'ease of doing business' agenda. Mint breaks down the key decisions from Sebi's 210th board meeting, and what they mean for investors, startups and the broader financial ecosystem. What did Sebi decide for promoters of startups? Sebi permitted founders designated as promoters to retain employee stock options (Esops), provided these were granted at least a year before the company filed its draft red herring prospectus (DRHP). Earlier, such holdings had to be liquidated before the listing, creating regulatory headaches for startup founders, already under pressure to become unicorns and reward their early investors with rich exits. Many are now in wait-and-watch mode. 'The move by Sebi is intended to ease the pain of many promoters who started the business, going from employee to entrepreneur," said Archana Balasubramanian, partner at Agama Law Associates. Also read | Mint Explainer: How Sebi uncovered Sanjiv Bhasin's alleged stock manipulation scheme Shubha Yadav, partner at RS Law Chambers, termed the change 'clear and targeted", adding that the one-year cooling-off period 'covers only those share-based benefits including Esops granted one year prior to the filing of the DRHP, which should not raise any legal or compliance challenge during IPO preparation". Flagging potential grey areas, Ketan Mukhija, senior partner at Burgeon Law said, 'Determining the start of the cooling-off period and ensuring there are no indirect grants will require careful documentation." How is Sebi easing PSU delistings? Public sector undertakings (PSU) in which the government and other PSUs hold an at least 90% stake can now delist without the two-thirds public shareholder approval that was previously mandated. The new fixed-price route requires a 15% premium above the calculated floor price, based on historical data and independent valuation. Prashant Mishra, founder & CEO of Agnam Advisors, said government-owned companies now have a clearer path to exit the stock market through a straightforward pricing system, making it easier for big institutional investors to understand what is happening. Legal experts said one critical legal question remains: how will minority shareholders' rights be safeguarded? Abhishek Dadoo, partner at Khaitan & Co, said this framework enables the delisting of PSUs that would otherwise struggle to exit, but comes at the cost of diluting minority protections. 'The delisting price is linked to an independent valuation, not the historic market price—which could be higher. The removal of the public vote effectively un-democratises the process." he added. Can AIF investors now co-invest more easily? Category I and II AIFs can now offer co-investment schemes (CIVs) within their structure, giving accredited investors a chance to invest alongside the AIF in unlisted companies. 'The approval of the co-investment vehicle is a breakthrough that will significantly expand private capital participation in India," said Gopal Srinivasan, chairman and managing director, TVS Capital Funds. 'Typically, in global practice, 15-20% of a fund's corpus comes through such co-investments, and this is now within reach", he said. Also read: Sebi's new fee platform aims to protect investors. But not many have taken to it However, Nandini Pathak, partner at Bombay Law Chambers, emphasised caution, saying the eligibility of co-investors would hinge on their accreditation status. 'Restrictions may continue around exit timing and terms. These advisory rights are being considered for listed co-investments," she said. Pathak suggested fund managers adopt appropriate internal controls and best execution practices, and provide adequate disclosures to the main AIF investors. How is Sebi changing investment norms for angel funds? Only accredited investors (AIs) can now invest in angel funds. AIs undergo independent verification to ensure compliance and protect investors. Earlier investments by non-AIs are grandfathered in, with a one-year transition period. Limits for investing in startups have been widened from ₹10 lakh to ₹25 crore), the 25% concentration cap has been removed, and more than 200 accredited investors can invest together. Managers must retain 'skin in the game" of at least 0.5% or ₹50,000 per deal. Experts said AIFs have long been attracting high-net-worth individuals (HNIs) and relatively sophisticated investors, which gives Sebi more leeway to relax norms and make it easier to do business. 'It is now possible for fund managers to advise on listed securities, allowing them to provide advisory services," said Kush Gupta, director at SKG investment & Advisory. He added that the revision of investment thresholds would give angel funds more flexibility to choose their investments. What relief has Sebi offered to FPIs who invest only in government securities? Sebi has eased compliance norms for foreign portfolio investors that invest only in government securities (GS-FPIs). Key measures include longer KYC review cycles, no need to disclose investor group structures. NRIs and OCIs can now be constituents of GS-FPIs without restrictions, and material changes can be reported within 30 days, from from 7 days. These steps aim to attract foreign capital as Indian G-Secs have been included in global bond indices since 2024-25. Also read: Sebi engages with venture capital funds directly to smoothen transition to AIF 'The risk profiling for FPIs who only invest in G-Secs is now various notches lower than a mix portfolio FPI with significant easing," said Manisha Shroff, partner at Khaitan & Co. However, she flagged some legal ambiguities. 'Sebi's relaxation is currently only for existing and prospective FPIs that exclusively invest in G-Secs. The fine print on how long such FPIs need to remain sovereign-only and if there will be different and fast-tracked registration process remains to be seen." What is the new settlement scheme for brokers involved in the NSEL case? Sebi has introduced a one-time monetary settlement plan based on quantity and value of trades. Brokers facing enforcement actions—but not named in charge sheets or declared defaulters—can opt in to close proceedings. The settlement mechanism for NSEL-related brokers is a bold move to unclog legacy enforcement actions, said Amit Tungare, managing partner at Asahi Legal, said. "Sebi will need to ensure that the settlements do not dilute accountability, particularly in cases involving systemic failure", he said.
Time of India
a day ago
- Business
- Time of India
Explained: Sebi's new Esop norms for IPO-bound startup founders
Capital markets regulator Securities and Exchange Board of India (Sebi), in a board meeting on June 18, greenlit multiple measures to enable "ease of doing business". One of them was relaxing norms around employee stock options (Esops) for startups heading to Dalal Street. Here is a look at the rules and the updates: As per the new rules, Sebi is allowing startup founders to continue holding Esops even after their company lists on the stock exchange. What was the old rule? Previously, it was mandated that founders be classified as "promoters" when filing their initial public offering (IPO) documents. After that, they would be ineligible to hold or be granted share-based benefits such as Esops. If they held shares before the IPO, they had to liquidate them. Founders miffed Discover the stories of your interest Blockchain 5 Stories Cyber-safety 7 Stories Fintech 9 Stories E-comm 9 Stories ML 8 Stories Edtech 6 Stories Founders found this provision impacted them negatively. Because of these rules, they could not benefit from their company's potential long-term growth through their stock options after listing and had to sell their holdings at a less mature stage in the company's life. Many felt the rule was unfair. In their early stages, startups often compensate founders with Esops instead of high salaries to conserve cash and align their interests with shareholders. However, as companies secure investments, founders see their equity stake getting diluted. The old rule effectively penalised them for their ownership stake ahead of an IPO. What are the changes? The regulator said the new rule would facilitate founders who received Esops at least one year prior to the filing of the draft red herring prospectus (DRHP) to continue to hold such benefits. Why the change? Sebi has acknowledged the ambiguity in the old regulations. The markets watchdog stated that requiring an employee, later classified as a promoter due to his/her shareholding and options, to forgo these benefits may not be justified.
Time of India
2 days ago
- Business
- Time of India
Sebi eases regulations for startup founders and public sector cos to boost capital market
The Securities and Exchange Board of India (SEBI) has approved new rules. Startup founders can now hold employee stock options after listing. Alternative investment funds get co-investment opportunities. Public sector companies can voluntarily delist with relaxed norms. Foreign funds will benefit from eased investment rules. These changes aim to boost investment and simplify regulations for businesses in India. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Mumbai: The board of India's capital markets regulator on Wednesday cleared a draft of measures to enable ease of doing business, including allowing startup founders to continue holding employee stock options (Esops) even after listing, extending co-investment opportunities to alternative investment funds , and permitting voluntary delisting of public sector rules require founders to be classified as promoters at the time of filing of initial public offering (IPO) documents. However, once listed as promoters, they are ineligible to hold or be granted share-based benefits. If they hold Esops at the time of filing of offer documents, they are required to liquidate such benefits before the IPO."This provision has been found to be impacting founders," Sebi chairman Tuhin Kanta Pandey are "classified as promoters at time of filing of DRHP (draft red herring prospectus)," Pandey regulator said the new rule would facilitate founders who received such benefits at least one year prior to the filing of DRHP with Sebi, to continue to hold such also eased norms for foreign funds investing in government securities. This comes at a time when several global index providers have included local sovereign debt in their respective bond indices, such as JP Morgan Global EM Bond Index, Bloomberg EM Local Currency Government Index and FTSE Russell Emerging Markets Government Bond has harmonised KYC (know your client) requirements with the central bank Sebi also clarified that no new Esops could be issued to promoters after the company is listed. The regulator has also approved tweaking of rules on offer for said equity shares received upon conversion of fully paid-up compulsorily convertible securities received pursuant to an approved scheme would be exempted from the requirement of a minimum public holding period of one present, this exemption is allowed only for equity shares acquired pursuant to an approved scheme. "This will assist the companies contemplating reverse flipping," the Sebi chief Sebi board also approved the proposal to allow public sector companies (PSUs) to voluntarily delist from stock exchanges through a separate carve-out mechanism-provided the government holds more than 90% stake. There are five listed PSUs where government holding equals or exceeds 90%.This new rule would not be applicable to banks, non-banking financial companies and insurance delisting is considered successful if the promoter's shareholding, along with shares tendered by public shareholders, reaches 90%.Under the proposed mechanism, PSUs could go private through a fixed-price delisting process, irrespective of whether their shares are frequently or infrequently traded. However, the fixed delisting price would need to be at least 15% premium over the floor regulator has also relaxed the requirement of securing approval from two-thirds of public shareholders for delisting Sebi board also approved the proposal to permit AIFs and investors to co-invest in unlisted companies through AIFs."Sebi's approval of a dedicated co-investment vehicle (CIV) framework under the AIF regulations is a breakthrough reform. It streamlines how accredited investors - already participants in AIFs - can co-invest in high-conviction opportunities alongside fund managers, aligns India with global norms, and removes longstanding friction around such structures," said Gopal Srinivasan, chairman and managing director, TVS Capital new norms will allow both higher fund flows and limit regulations, experts said."This will further increase the flow of private--especially domestic capital--to entrepreneurial and growth businesses. By limiting CIVs to accredited investors, Sebi has also signaled a shift toward more principle-based, lighter-touch regulation for qualified participants," Srinivasan said. "Alongside the clarity on ESOPs for startup founders, this marks Sebi's strong commitment to innovation, deeper capital access, and sustained alignment among investors, founders, and fund managers," Srinivasan regulator said a separate co-investment scheme would have to be launched for each co-investment in an investee company.
Time of India
2 days ago
- Business
- Time of India
Sebi eases Esop rules; VCs chase secured credit
Sebi eases Esop rules; VCs chase secured credit Also in the letter: Sebi relaxes Esop norms for IPO-bound startup founders Tell me more: Quick recap: Also Read: But why: VCs back fintechs entering secured credit amid unsecured lending slowdown Driving the news: Vridhi Home Finance, Basic Home Loans, and Easy Home Finance have all raised venture rounds over the past year. Techfino and Mahaveer Finance (as we are reporting today) have secured equity funding from marquee investors. MSME-focused Loantap also closed a fresh round recently. Carving out a niche: Improving operational efficiency through technology Applying tech-enabled underwriting even when property inspections are required Leveraging government digital databases for land and property records The catch: NBFC-style businesses require consistent and sustainable growth, which often clashes with typical VC growth expectations. LAP products may seem attractive, but the segment has historically experienced non-performing assets (NPAs). Fintechs entering the space will need strong collection infrastructure to stay resilient. Mahaveer Finance raises Rs 200 crore Byju's RP alleges asset diversion by former directors Details: $533 million allegedly moved to related entities via a US subsidiary Rs 130 crore transferred to an Indian unit RP Shailendra Ajmera has asked the NCLT to hold directors accountable In response, Riju Raveendran has challenged Ajmera's role citing conflict of interest Tell me more: Charges levelled: Counter: Deeptech VCs rev up fundraising efforts Driving the news: Java Capital is increasing its fund size from Rs 50 crore to Rs 240 crore. Bharat Innovation Fund (BIF) is eyeing $150 million for its second round Ideaspring Capital and Mela Ventures are in the market with their third and second funds, respectively Navam Capital is raising its debut fund of $30 million. Other Top Stories By Our Reporters Insolvency plea filed against FirstCry subsidiary GlobalBees: Karnataka to survey AI impact on workforce: Ola drivers across India can keep entire fare earnings: Global Picks We Are Reading The markets regulator has relaxed Esop rules for founders preparing to take their companies public. This and more in today's ETtech Morning Dispatch.■ Urban Company swings to profit■ Deeptech VCs rev up fundraise■ Insolvency trouble for FirstCryIndia's markets regulator, the Securities and Exchange Board of India (Sebi), has eased rules for startup founders on retaining their employee stock options (Esops) as they take their companies can now retain Esops granted at least a year before filing the draft red herring prospectus (DRHP). These stock options may continue to be exercised even after the company lists, and the founders are classified as promoters, Sebi decided in its board meeting on filing IPO papers, founders were regarded as promoters. Once the company was listed, they could no longer be granted Esops and had to liquidate any outstanding stock options before going public. Sebi acknowledged that this rule negatively impacted founders during the initial public offering (IPO) relaxed norms are expected to help companies looking to list in India following a reverse flip Digital lending startups that once focused heavily on unsecured consumer credit are now transitioning towards secured lending , as the unsecured segment exhibits evident signs of a venture firms are doubling down on investments in home finance and secured credit platforms. These include products such as loans against property (LAP), mutual fund-backed credit, and other asset-based traditional lenders continue to dominate the space, fintechs see opportunities to disrupt key areas:Despite strong investor interest, secured lending is not a natural match for venture capital. Most VC firms favour hyper-growth tech plays, while secured credit demands a different non-bank lender Mahaveer Finance raised Rs 200 crore in its first venture funding round. Elevation Capital led the round, with participation from Banyan Tree Finance and First Bridge Raveendran, founder, Byju'sByju's insolvency resolution professional (RP), backed by EY, has alleged that former directors are liable under IBC provisions for transactions that diverted company Ajmera, the RP of Byju's parent company, Think and Learn, claimed in lawsuits filed late April that two separate sets of transactions were detrimental to the claimed Think and Learn was deprived of the money, which its directors Byju Raveendran, Riju Raveendran, and Divya Gokulnath, should have early April, Riju Raveendran approached the NCLT, claiming Ajmera should be removed as the RP of Think and Learn, citing conflict of deeptech-focused venture capital funds are stepping up their fundraising efforts , as the ecosystem matures with growing government backing and favourable geopolitical investments in India doubled in the first four months of 2025, reaching $324 million across 35 deals. This compares to $156 million across 21 deals during the same period last year.(L-R), Supam Maheshwari and Nitin Agarwal, founders, GlobalBeesThe directors of the direct-to-consumer (D2C) homecare company Kuber Industries have filed an insolvency petition against GlobalBees Brands, a subsidiary of the omnichannel retailer FirstCry, concerning unpaid dues amounting to Rs 65 state government has invited responses from industry leaders, HR heads, technology practitioners, and academics on how they are using artificial intelligence (AI) in the workplace to identify skill gaps, emerging job roles, and the nature of workforce platform Ola has introduced a zero-commission model across India, allowing driver-partners of autos, bikes, and cabs to keep 100% of their fare earnings.■ This AI model never stops learning ( Wired ■ AI obituary pirates are exploiting our grief. I tracked one down to find out why ( CNET ■ India wants its own EV market, but needs China to get there ( Rest of World
