India‘s first asset reconstruction company is exploring fee-based businesses, including acting as a recovery and collection agent for lenders, as it looks for new growth avenues ahead of its planned IPO next week, its chief executive said.
Asset Reconstruction Company (India) is set to launch the IPO on September 9, becoming the first such company to list on domestic stock exchanges.
The IPO is an offer for sale of up to 52.73 million shares at a price band of 132 rupees-139 rupees per share, lending an issue size of 7.33 billion rupees ($77.58 million) at the upper end, according to the company prospectus.
At 139 rupees per share, ARCIL’s implied valuation is about 45.16 billion rupees, according to Reuters’ calculations. The firm received regulatory approval for the IPO in August 2025.
Its top shareholders, Avenue India Resurgence, owned by New York-headquartered investment firm Avenue Capital Group, and State Bank of India SBI.NS, which together hold 89.68% in ARCIL before the offer will see their stake fall to 78.67% following the OFS, assuming the entire offer is allotted.
Other investors such as Lathe Investment and Federal Bank FED.NSwill also sell their shares.
The asset reconstruction company does not need fresh capital for growth, management said.
“Our capital adequacy ratio is close to 65% and our internal accruals will sufficiently fund us in the short term,” CEO Phanindranath Kakarla told Reuters. “It is important that the first ARC listing comes from a position of strength.”
ARCIL’s assets under management stood at 201.5 billion rupees as of March-end, while collections fell to 34.84 billion rupees in fiscal 2026 from 38.82 billion rupees a year earlier.
However, CFO Pramod Kumar Gupta said retail recoveries remained strong.
“On an aggregate basis, we are collecting close to 25% of opening assets under management, which we believe is a healthy collection ratio,” Gupta said.
Kakarla said ARCIL was increasingly focusing on retail and small-ticket distressed assets to offset fewer opportunities in large corporate bad loans, while tapping a sizeable opportunity in India‘s stressed assets market.
Reuters
