Highway and infrastructure developer Shivalaya Construction has filed Draft Red Herring Prospectus (DRHP) with the Securities and Exchange Board of India (SEBI). Shivalaya Construction IPO will include a fresh issue worth up to INR 450 crore alongside an offer for sale (OFS) of 2.49 crore shares by its promoters and promoter group.
A Two-Decade Journey on India’s Roads
Founded in 1997, Shivalaya has grown into an integrated EPC and HAM contractor with a stronghold in road and bridge construction. As of July 2025, it had executed 41 projects across 19 states, building over 2,700 lane kilometres of highways. Its current pipeline includes about 1,500 lane kilometres of ongoing projects.
The company has increasingly shifted towards the hybrid annuity model (HAM), which now contributes the bulk of its revenues. In FY25, HAM generated 84% of operating revenue, dwarfing EPC’s 12.6% and other sources’ 3.8%.
Shivalaya Construction IPO: Promoters & Selling Shareholders
The company remains tightly held, with promoters and their families controlling 96.3% of equity pre-offer. The DRHP shows that:
- Shripal Aggarwal will offload up to 1.16 crore shares,
- Pradeep Nandal 58 lakh shares, and
- Sumitra Nandal 62 lakh shares.
Financial Performance
Shivalaya’s financials reveal a story of strong order wins but rising strain on profitability.
- Revenue from operations slipped to INR 3,124.5 crore in FY25, down 12% from the previous year’s INR 3,537.57.
- Profit after tax halved to INR 359.8 crore, compared with INR 600.6 crore in FY24.
- EBITDA margins compressed to 24.8% from 27.9%.
The company plans to deploy INR 340 crore of IPO proceeds to repay or prepay borrowings, a move seen as crucial to restore balance sheet strength.
Order Book Rebound After 2-Year Slide
While the order book fell from INR 6,592.2 crore in FY23 to INR 2,835.9 crore by March 2025, it recovered to INR 3,626.9 crore by July, thanks to new wins. The largest shares come from Jharkhand, Kerala, and Uttar Pradesh, which together account for about 70% of the pipeline.
Dependence on government contracts remains high, with the National Highways Authority of India and associated nodal agencies contributing more than half the order book. This ensures payment security but also concentrates exposure.
Diversification Into Power and Renewables
Beyond roads, Shivalaya Construction is bidding for projects in power transmission, solar energy, and railways. It has brought in new leadership for the power and transmission vertical and is preparing offerings such as solar-plus-storage systems with battery energy storage. With government capex rising in both highways and renewables, the company is positioning itself to capture adjacencies.
The Road Ahead
Shivalaya’s IPO comes at a critical juncture. The company offers investors a large order pipeline, long-standing government relationships, and sector diversification. Yet, its balance sheet is stretched, profitability has weakened, and dependence on debt-funded HAM projects remains high.
If Shivalaya can sustain order inflows to keep its book-to-bill ratio above 1×. The IPO thus presents both an entry into India’s infrastructure growth story and a test of whether the company can steer past its financial bottlenecks.
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