Asset Reconstruction Company (India) Limited

Asset Reconstruction Company (India) Limited (Arcil) was incorporated as a public limited company on February 11, 2002. It obtained its certificate of registration to commence operations on August 29, 2003, from the Reserve Bank of India (RBI) under the SARFAESI Act, and completed its first acquisition of stressed assets in December 2003. Its core business is acquiring non-performing and distressed assets (NPAs) from banks and financial institutions and implementing customized resolution strategies to maximize recovery and optimize asset value. Promoted by Avenue India Resurgence Pte. Ltd. (an affiliate of the global distressed debt investor Avenue Capital Group) and the State Bank of India, Arcil functions on a trust-based operating model. Under this model, the company sets up Special Purpose Vehicle (SPV) trusts for asset acquisition and securitization, issuing Security Receipts (SRs) representing undivided interest in the underlying assets to Qualified Buyers (QBs). Revenue is generated primarily through management/trusteeship fees (typically a percentage of the managed outstanding asset net asset value) and investment income from its own capital contributions in these SRs.

The company's operations are organized across three primary business verticals: Corporate loans, SME and Other loans, and Retail loans. Its key client segments on the sourcing side include a diversified base of lenders, spanning public sector, private sector, co-operative, and foreign banks, alongside Non-Banking Financial Companies (NBFCs), Housing Finance Companies (HFCs), and Microfinance Institutions (MFIs). Through these segments, Arcil's target demographics for debt resolution encompass large corporate borrowers, MSMEs, and individual retail loan defaulters (including personal, housing, vehicle, and credit card loan portfolios). Geographically, the company maintains a nationwide presence with a network of 13 offices spread across 12 states (including Delhi) as of March 31, 2026. This on-the-ground reach is supported by 206 personnel, 218 registered valuers, 206 collection agents, and 988 empanelled lawyers.

As a specialized financial services enterprise and a regulated Non-Banking Financial Company (NBFC), Arcil does not own, lease, or operate any industrial manufacturing infrastructure, factory buildings, or production facilities. Accordingly, traditional metrics relating to factory locations, plant layouts, installed industrial capacities, and capacity utilization figures are not applicable to its business model. The company's physical infrastructure is entirely administrative and corporate, centered at its registered and corporate headquarters situated at the 10th Floor, The Ruby, Dadar (West), Mumbai, alongside its regional branch offices.

Although the company does not perform clinical or laboratory R&D, its information technology infrastructure and data analytics capabilities are major operational highlights that drive the business. Arcil utilizes proprietary pricing models and scenario analysis during pre-acquisition due diligence to map recovery potential. The credit assessment process incorporates proprietary scorecards used in conjunction with Credit Information Company (CIC) scrubs to predict borrower risk profiles and evaluate portfolio quality. On the collection and monitoring side, Arcil utilizes advanced loan collection workflow systems, field agent geo-tracking, and digital payment systems (such as UPI and QR codes). To manage and scale retail recovery volumes, the company is also integrating NLP-based speech analytics, real-time APIs, and communication bots (IVR and tele-calling analytics) to automate settlement negotiations and optimize collection strategies.

As per financial performance, Asset Reconstruction Company (India) Limited has posted total income / net profits of Rs 609.49 Cr / Rs 310.89 Cr (FY24), Rs 607.84 Cr / Rs 309.24 Cr (FY25) and Rs 749.92 Cr / Rs 322.69 Cr (FY26). So as per previous financials data, the company has shown steady top-line and bottom-line growth in FY26 after a relatively flat FY25, while total debt increased from Rs 149.95 Cr in FY24 to Rs 1,205.50 Cr in FY26 to finance asset acquisition scaling. Company has an average EPS of Rs 9.73 and average RoNW of 11.66% for the last three fiscals. Based on the pre-issue book value, the issue is priced at a Pre-Issue P/BV of 1.53 as per NAV of Rs 90.96 as on 31.03.26. Factoring in the fresh issue proceeds, the Post-Issue P/BV stands at 1.53. If we attribute the latest earnings of FY24, FY25, and FY26 to the expanded equity base post-issue, then the asking price is at a Post-Issue P/E of around 14.53, 14.60, and 14.00 respectively. As per RHP, there are no listed peers in Indian Market.

On BRLM's front, IIFL Capital Services Limited (formerly known as IIFL Securities Limited), IDBI Capital Markets & Securities Limited, and JM Financial Limited are associated with this IPO, and IIFL Capital Services Limited has handled 50 IPOs in the last three fiscal years. (as on 03.09.26)

• 1 Avenue India Resurgence Private Limited
• 2 State Bank of India (SBI)