Avenue Capital Group-Backed ARCIL Files IPO Draft Papers with Sebi

Avenue Capital Group-backed Asset Reconstruction Company (India) Ltd (ARCIL) has filed its preliminary papers with markets regulator Sebi to mobilise funds through an initial share sale.

ARCIL facilitates debt resolution and is the first asset reconstruction company to be incorporated in the country.

The initial public offering (IPO) is entirely an offer for sale (OFS) of up to 10.54 crore equity shares by promoters and other shareholders, according to the draft red herring prospectus (DRHP) filed on Friday.

As part of the OFS, promoters -- New York-based Avenue Capital through its affiliate Avenue India Resurgence Pte Ltd is offloading up to 6.87 crore equity shares, and State Bank of India will be selling 1.94 crore shares. Federal Bank Ltd will also sell 10.35 lakh shares in the company.

Meanwhile, Singapore-based GIC through its arm Lathe Investment Pte Ltd is exiting the firm by selling up to 1.62 crore equity shares or 5 per cent stake in ARCIL.

Since the public issue is entirely an OFS, ARCIL will not receive any proceeds from the IPO.

ARCIL is engaged in the business of acquiring stressed assets from banks and financial institutions and implementing resolution strategies through restructuring, enforcement of rights on underlying securities and settlement aimed at maximising recovery and optimising the value of such stressed assets in order to generate revenue streams.

It is the first ARC to be incorporated in India, having received RBI registration in August 2003 under the SARFAESI Act, 2002, as per a CRISIL report. It completed its first stressed asset acquisition in December 2003.

Mumbai-based ARCIL was the second most profitable ARC in India in FY24 with a standalone profit of Rs 305.34 crore, and the second largest by assets under management (AUM) at Rs 15,230 crore.

It had the second largest net worth among private ARCs in India at Rs 2,462.5 crore on a standalone basis as on March 31, 2024, according to the report.

As of March 31, 2025, it had acquired total principal debt of Rs 72,657 crore at a cost of Rs 38,156 crore or 52.51 per cent of the total principal debt and made recoveries of Rs 28,460 crore and the company's total borrowings stood at Rs 305.99 crore.

ARCIL competes with the likes of Edelweiss ARC, Phoenix, JM Financial ARC, ACRE and Omkara.

IIFL Capital Services, IDBI Capital Markets & Securities and JM Financial are the book-running lead managers while MUFG Intime India is the registrar for the IPO.

The shares of the company are proposed to be listed on the BSE and NSE.