Hella Infra Market, better known as Infra.Market, is currently trading at around ₹98,000 per share in the unlisted market and could potentially enter the public markets through a backdoor listing route via its subsidiary, Shalimar Paints, rather than through a traditional IPO.
Hella Infra had invested ₹270 crore in Shalimar Paints in 2022. Now, Shalimar Paints has announced a proposed transaction under which it would issue shares and CCPS to Hella Infra shareholders through a share-swap arrangement. If completed, the transaction could provide Hella Infra with a route to the public markets without having to undertake a conventional IPO.
The first step is to increase Shalimar Paints’ authorised share capital from ₹20 crore to ₹600 crore. The company plans to increase its authorised equity shares from 10 crore to 300 crore shares, with a face value of ₹2 each. This increases the company’s capacity, or headroom, to issue new equity shares. It does not mean that Shalimar Paints has raised ₹600 crore.
The second step is the addition of Compulsorily Convertible Preference Shares (CCPS) to the authorised capital. Shalimar Paints proposes to create 200 crore CCPS with a face value of ₹2 each, representing ₹400 crore of authorised CCPS capital. Together with the ₹600 crore authorised equity capital, the company would have created ₹1,000 crore of authorised capital headroom.
The actual transaction then has multiple components. Shalimar Paints proposes to issue 1.24 crore equity shares at ₹85 per share, aggregating to approximately ₹105 crore, through a preferential issue to non-promoter allottees. This is the cash component of the preferential issue, subject to shareholder and regulatory approvals.
Alongside this, Shalimar Paints proposes to issue 41.70 crore equity shares at ₹85 per share, worth approximately ₹3,544 crore, as consideration other than cash to promoter and non-promoter allottees. In simple terms, these shares are not being issued against a ₹3,544 crore cash payment; they form part of the consideration for the assets or securities being brought into the transaction.
The company is also proposing to issue 81.12 crore CCPS at ₹85 per share, aggregating to approximately ₹6,895 crore, again as consideration other than cash to promoter and non-promoter allottees. Together, the proposed non-cash equity and CCPS issuance amounts to approximately ₹10,440 crore.
Shalimar Paints is separately planning to raise up to ₹1,000 crore through a QIP, subject to the necessary approvals. Therefore, the actual cash fundraising currently proposed consists of approximately ₹105 crore through the preferential issue plus up to ₹1,000 crore through the QIP. The approximately ₹10,440 crore share issuance is non-cash consideration, not a ₹10,440 crore cash fund raise.
The important question for unlisted investors is the share-swap ratio. The company has not yet disclosed the final ratio. Shalimar Paints has stated that its investment in the equity shares and CCPS of Hella Infra Market will be made through a swap ratio based on valuation reports of Shalimar Paints and Hella Infra Market. Therefore, the final number of Shalimar securities received by each Hella Infra shareholder will depend on the valuation exercise and the resulting swap ratio.
Shalimar Paints has also stated that Hella Infra Market may subsequently become an unlisted material subsidiary of the company. The Board has further discussed and evaluated a potential strategic option aimed at maximising synergies between Shalimar Paints and Hella Infra Market, including exploring the possibility of unification of the entities at an appropriate stage, subject to applicable laws and the required approvals.
The valuation is where the transaction becomes particularly interesting. Hella Infra Market is currently valued at around ₹11,185 crore in the unlisted market, based on the prevailing unlisted share price. However, its last reported funding round in September 2025 valued the company at approximately ₹24,600 crore, when it raised around ₹730 crore. This means there is a significant difference between the current unlisted-market valuation and the valuation from its last reported institutional funding round.
For unlisted investors, however, the ₹11,185 crore market valuation and ₹24,600 crore previous funding valuation should not be treated as the final valuation for the Shalimar transaction. The final transaction value will depend on the valuation reports and the agreed share-swap ratio.
The key things to watch now are the valuation reports, final share-swap ratio and the EGM notice. These will determine how Hella Infra shareholders are converted into Shalimar Paints shareholders, the effective valuation assigned to Hella Infra Market, the resulting ownership structure and the level of dilution for existing Shalimar Paints shareholders.