In today’s deep dive, we will examine how Infra.Market plans to go public through Shalimar Paints without a conventional IPO, and why startups might prefer this route. We will explore similar deals in India, lessons from America’s SPAC failures, and the regulatory risks involved. Finally, we will assess whether this could become a popular exit route for Indian unicorns or remain limited to a few companies.

In 1902, two British entrepreneurs established Shalimar Paints in Howrah, near Kolkata. Over the next century, its paints found their way onto some of India's most recognisable structures, including the Howrah Bridge and Rashtrapati Bhavan. The company survived wars, economic crises, changes in ownership and the rise of giants such as Asian Paints and Berger. By 2026, however, Shalimar had become a relatively small player in an industry it had helped establish.

Now comes an extraordinary development. This 124-year-old paint company could become the vehicle through which one of India's largest construction-material startups enters the stock market. Infra.Market, a privately held company valued at approximately ₹25,000 crore, plans to use Shalimar, which had a market value of less than ₹700 crore before the announcement, to create a publicly traded business.

What makes the transaction particularly interesting is that Infra.Market had already prepared for a conventional IPO. It had confidentially filed its papers in September 2025 and reportedly secured SEBI's approval in January 2026 for a public offering of approximately ₹5,000 crore. Its founders, Aaditya Sharda and Souvik Sengupta, had spent a decade building a business with nearly ₹20,000 crore in annual revenue.

Then, in August, came a different proposal. Rather than list Infra.Market directly, the group would issue thousands of crores worth of Shalimar shares to Infra.Market's existing investors. The private company's shareholders would become shareholders in the listed company, and Shalimar would acquire a substantial stake in Infra.Market. A further restructuring could eventually place the much larger private business underneath the listed paint company.

It raises an obvious question. If a startup can reach the public market through a company it already controls, why would it spend months preparing an IPO, negotiating with investment bankers and accepting whatever valuation public investors are willing to pay? More importantly, if this works, what stops dozens of other Indian unicorns from doing the same?

To understand the deal, we need to go back to 2022, when Infra.Market first invested in Shalimar Paints.

At the time, the acquisition appeared to be a straightforward business decision. Infra.Market had started in 2016 as a platform supplying construction materials. It subsequently expanded into concrete, steel, tiles, cement, chemicals and other building products. Shalimar gave it an established paints brand, manufacturing capacity and access to thousands of dealers. It also gave Infra.Market another product to sell through its growing distribution network.

Infra.Market initially committed ₹270 crore to Shalimar through equity and convertible debt. Its ownership subsequently increased, and by 2026, Hella Infra Market, the company behind Infra.Market, directly controlled approximately 52.85% of Shalimar. The broader promoter group owned nearly 75%.

For four years, the relationship followed a familiar pattern: a rapidly growing private business owned a listed subsidiary. Then the direction of the transaction changed. Shalimar would acquire shares in its own parent, while the parent's investors would receive new securities in Shalimar.

Under the proposal, Shalimar would issue approximately 41.70 crore ordinary shares worth ₹3,545 crore and another 81.12 crore compulsorily convertible preference shares worth ₹6,895 crore. Both would be priced at ₹85 apiece. The total transaction value would be approximately ₹10,440 crore.

In return, Shalimar would acquire securities representing about 41.47% of Infra.Market's fully diluted capital. Once the preference shares converted, the investors receiving those securities would collectively hold approximately 93% of Shalimar's enlarged equity.

Consider what that means for someone who owned Shalimar shares before the deal. Existing public shareholders collectively held roughly 25% of the company. After the proposed issuance and conversion, their combined holding would fall to around 1.6%, before any additional capital raising.

The transaction does not necessarily reduce Shalimar's total regulatory public shareholding to 1.6%, because some incoming Infra.Market investors could also be classified as public shareholders. But the scale of the dilution is remarkable.

There is another distinction that tends to disappear in headlines. The ₹10,440 crore transaction does not bring ₹10,440 crore into Infra.Market's bank account. Shalimar would issue its securities in exchange for existing private-company shares. It is primarily an exchange of ownership, rather than a cash investment.

That makes the separately proposed ₹1,000 crore institutional fundraising particularly important. The share exchange could help create a listed structure for the group. The fundraising, if successfully completed, could provide money for refinancing debt and supporting operations.

And the initial 41.47% stake does not automatically give Shalimar ownership of the entire private business. Additional arrangements or transactions may be required to establish the intended holding-company structure. The proposal itself envisages further integration over time.

This distinction matters because the deal is often described as though the entire ₹25,000 crore unicorn is already being merged into Shalimar. As of November 13, 2026, that remains the intended direction of a transaction still subject to completion and regulatory requirements.

An IPO forces founders and investors to confront something private markets can postpone for years: what thousands of outside investors are actually willing to pay for the business.

Consider a startup that raises its last funding round at a $3 billion valuation. Its investors celebrate, employees see their stock options become more valuable on paper, and the founders can point to a successful fundraising. But when the company approaches public-market investors two years later, those investors may value it at only $2 billion.

The company now faces an uncomfortable choice. It can accept a lower valuation, postpone the IPO or reduce the amount it wants to raise. None is particularly attractive to investors who entered at higher prices and may already have held their investments for seven or eight years.

Infra.Market had reasons to consider this problem carefully. In early 2025, it raised approximately $121 million at a valuation of about $2.8 billion. It subsequently attracted more capital at broadly similar valuations. By the time it contemplated its public offering, preserving that valuation would have mattered to founders and investors alike.

A share swap offers a different way to establish the starting price. Instead of asking public investors to subscribe to the entire private business through an IPO, the parties negotiate an exchange ratio based on professional valuations.

Infra.Market's April 2026 valuation report, using discounted future cash flows, placed its equity value at roughly ₹24,620 crore. That valuation became an important reference point for the proposed exchange.

But there is a catch. An agreed valuation is not the same as a market-tested valuation. Once the new Shalimar securities begin trading and investors understand the enlarged business, they will decide what those shares are worth.

If the market values them substantially below the ₹85 issue price, the transaction may preserve the old valuation on paper while doing little to preserve it economically.

And valuation may be only part of Infra.Market's motivation. Its financial statements suggest another reason why the company would be interested in gaining access to a listed company.

Infra.Market is considerably larger than the typical venture-backed startup preparing to list. According to a September 2026 report from credit-rating agency Acuité, its consolidated revenue increased from ₹18,470 crore in FY2025 to approximately ₹19,718 crore in provisional FY2026.

Its operating margin improved from 8.2% to nearly 9%, and net profit rose from around ₹220 crore to ₹309 crore.

Those figures describe a substantial business, but they also reveal how demanding its operations are. On almost ₹20,000 crore of revenue, Infra.Market earned a net margin of only 1.56%. For every ₹100 of sales, approximately ₹1.56 remained as profit after expenses and taxes.

The thin margin is partly explained by the nature of the business. Infra.Market is not simply running a marketplace where buyers and sellers transact and the company collects a commission. It has expanded into manufacturing, distribution and private-label products. Concrete accounted for approximately 35% of FY2026 revenue and steel for another 21%.

These businesses need factories, inventories, transport, supplier payments and working capital. Customers may take weeks or months to pay, while lenders and suppliers still expect their money on time.

The valuation report reviewed by Inc42 showed approximately ₹6,057 crore of debt and ₹1,028 crore of cash and cash equivalents as of February 2026. That suggests net debt of a little over ₹5,000 crore on that basis.

The credit-rating report reveals an even more interesting problem. In FY2026, Infra.Market generated approximately ₹801 crore in net cash accruals against around ₹1,752 crore of debt repayment obligations. The difference had to be managed through financing sources including refinancing and fresh equity.

Acuité noted that the company had raised more than ₹915 crore in equity during FY2026 and undertaken substantial refinancing. It also warned that debt repayments would increase sharply in FY2029, making further funding an important consideration.

This changes how one should view the proposed reverse listing. For Infra.Market, access to public capital could be strategically valuable because it operates in a business where growth constantly demands money.

A ₹1,000 crore institutional placement could help reduce debt or refinance obligations. Listed shares could also become useful when acquiring other businesses, because sellers might accept equity instead of requiring full payment in cash.

However, this needs perspective. A ₹1,000 crore fundraise, even if entirely available for debt reduction, would cover only about one-sixth of the reported gross borrowings.

There is also a valuation issue that deserves more attention. At ₹24,620 crore, Infra.Market's equity would be valued at approximately 80 times its provisional FY2026 net profit. Its enterprise valuation of around ₹28,124 crore represents approximately 16 times annual operating earnings before interest, tax, depreciation and amortisation.

These multiples may be defensible for a rapidly growing, highly profitable company. For a construction-materials business growing revenue by approximately 7% in FY2026, they require stronger assumptions about future growth, margins and debt reduction.

That is precisely the debate an IPO would bring into the open. A reverse listing may change when and how the market judges those assumptions, but it cannot make the debate disappear.

There is another group of people for whom this route could be attractive: venture capital investors who have been waiting years to sell their holdings.

Suppose a fund invested ₹100 crore in a startup in 2017. Nine years later, the startup's valuation has increased fivefold. On paper, the fund's holding may be worth ₹500 crore. But until it sells shares, it cannot return that amount to the investors who financed the fund.

This becomes increasingly uncomfortable as a fund approaches the end of its life. Its investors want their money back, and the fund manager needs realised returns rather than increasingly large numbers in a valuation report.

A conventional IPO can provide liquidity through an offer for sale, although restrictions and market conditions still apply. A reverse listing creates another possibility. An investor can exchange private-company holdings for listed-company securities, potentially making a future sale easier.

Infra.Market's proposed list of recipients included sophisticated investors and the company's founders. The transaction could eventually turn some of their previously illiquid holdings into securities capable of being sold on a stock exchange.

Yet this benefit is easily exaggerated. Listed shares are not cash. Some may be locked in, preference shares may still require conversion, and a large investor cannot necessarily sell hundreds of crores worth of stock without depressing its price.

A ₹25,000 crore quoted valuation is of little use to an investor if there are only a few crores of genuine buyers in the market.

There is a second complication. A reverse listing may avoid raising substantial cash from public investors at the outset, but that also means it does not necessarily bring in the new shareholders who would provide deep trading liquidity.

For a venture fund, the route may solve the problem of holding private shares without fully solving the problem of selling them.

Although Infra.Market's transaction looks unusual, India has already witnessed other businesses entering public markets through listed companies.

A recent example involves Sigma Advanced Systems, an aerospace and defence business that was privately held before merging into listed Megasoft.

In December 2025, the National Company Law Tribunal approved the merger, and Megasoft was subsequently renamed Sigma Advanced Systems. Under the arrangement, shareholders of the private company received 316 shares in the listed company for every 100 private-company shares. More than 10 crore new shares were issued.

The economic effect was similar to what Infra.Market is attempting. The private operating business became the main business behind an existing stock-market listing.

Sigma's FY2026 accounts reported a consolidated profit of approximately ₹268 crore compared with a restated loss of roughly ₹14 crore in the previous year.

At first glance, that looks like a remarkable turnaround. But the annual report also records a gain of approximately ₹185 crore from selling land and buildings. This illustrates another challenge with these transactions. Once companies are merged and previous accounts are restated, investors must separate operating improvements from accounting changes and one-off gains.

Sigma's route was also legally different. It completed a formal court-approved amalgamation. Infra.Market is beginning with a preferential share exchange, with further restructuring contemplated later.

Another interesting example comes from outside India's exchanges. In August 2025, India-linked biotechnology company Vyome completed a merger with Nasdaq-listed ReShape LifeSciences.

Following the transaction and associated financing, former Vyome shareholders owned approximately 88% of the combined company, while the original ReShape shareholders held around 12%. ReShape was renamed Vyome Holdings, and the new business began trading on Nasdaq.

The ownership pattern should sound familiar. A listed company issued enough shares to the owners of a private business that the newcomers became the overwhelming majority of its shareholders.

That is broadly what reverse listings achieve, although the precise legal structure differs from deal to deal.

Indian startups also have a history of using American SPACs, which are listed companies formed specifically to acquire another business.

In December 2016, Yatra Online completed its combination with Terrapin 3 Acquisition Corporation and began trading on Nasdaq. The transaction valued Yatra at an enterprise value of approximately $218 million and provided more than $92.5 million in primary capital.

Yatra's motivations were understandable. Online travel was intensely competitive, and companies needed money to acquire customers, improve technology and expand their offerings. A SPAC combination provided both a public listing and fresh capital.

The difference from Infra.Market is crucial. Yatra's combination delivered cash as part of the transaction. Infra.Market's proposed ₹10,440 crore swap does not.

The United States provides the clearest warning about using alternative routes to public markets.

During 2020 and 2021, SPACs became enormously popular. Investors established listed companies with cash but no substantial operating business. These companies then searched for private businesses to acquire.

For founders, the attraction was the ability to negotiate a valuation with a known counterparty instead of depending entirely on an IPO's public-book-building process. For venture investors, it offered another way to bring portfolio companies to the stock market.

The most memorable example was WeWork.

In 2019, WeWork attempted a conventional IPO after reaching a private valuation of approximately $47 billion. The offering collapsed as investors questioned the company's losses, governance and enormous property commitments.

Two years later, WeWork reached the stock market through a merger with BowX Acquisition Corp, a SPAC. The transaction valued the business at approximately $9 billion in enterprise value.

The alternative route achieved something the earlier IPO could not. It made WeWork a publicly traded company.

But the company's operating problems remained. In November 2023, WeWork filed for bankruptcy protection. Its public listing had neither repaired its economics nor protected shareholders from the consequences.

Another example is Indian renewable-energy company ReNew Power, which went public through an American SPAC combination in 2021.

The deal was announced at an enterprise valuation of roughly $8 billion. Five years later, in August 2026, a consortium involving CPP Investments and founder Sumant Sinha agreed to a proposed take-private acquisition at $7.02 per share.

That transaction valued ReNew's equity at approximately $2.8 billion and its enterprise at roughly $10.2 billion. The two enterprise values and the equity value should not be confused, particularly for an indebted renewable-energy business. Nevertheless, the proposed privatisation illustrates how a company can enter public markets through a SPAC and later decide that private ownership is more attractive.

The broader American record has been disappointing. An analysis by AUM Advisors of 24 SPAC combinations completed during the first half of 2026 found that the median deal saw approximately 89% of the original trust shares redeemed by investors.

In other words, many investors preferred taking their cash back rather than remaining invested in the proposed business.

That created a peculiar situation. A company could announce a merger with a SPAC holding hundreds of millions of dollars, only to discover that much of that cash had disappeared through redemptions by the time the merger closed.

Infra.Market's arrangement avoids that particular problem because Shalimar is an operating company, not a blank-cheque acquisition vehicle with a redeemable cash trust. However, Shalimar's existing shareholders do not get the same standard redemption option that American SPAC investors typically enjoy.

It raises the question of whether the Indian structure could face its own regulatory backlash.

India already has rules governing preferential share issues, takeovers, related-party transactions, mergers and the minimum percentage of shares held by the public.

A reverse listing does not make these rules disappear. The difficulty is that each requirement may apply differently depending on how the transaction is structured.

A share exchange requires appropriate valuations, shareholder approvals, disclosures and exchange permissions. A formal merger could require tribunal approval. Changes in control may bring takeover rules into consideration, while transactions between related companies raise additional questions about fairness.

The Infra.Market proposal has already demonstrated how complicated this can become.

In September, the NSE identified four proposed investors who were ineligible to participate in part of the preferential issuance because they had sold Shalimar shares during the preceding 90 trading days. Shalimar had to revise the proposed allotment arrangements.

Then came the shareholder vote on September 11. The non-cash equity issuance received overwhelming overall approval, but approximately 29.33% of the votes cast by public non-institutional shareholders opposed it.

That difference matters because promoters can dominate the overall vote while a substantial minority of outside shareholders remains unconvinced.

And in November, Shalimar's statutory auditor, Walker Chandiok & Co., resigned. The firm explained that the proposed combination would bring a substantial part of the enlarged group outside its existing audit coverage, making it unable to meet its required standards under the new structure. Shalimar's board recommended Sen & Ray as replacement auditor.

This was not an allegation of accounting misconduct. It was an illustration of how integrating a much larger business can create complications even before the transaction is finished.

There is also a particularly difficult ownership question. Infra.Market already owns a majority stake in Shalimar, but the intended final arrangement would place Infra.Market underneath Shalimar.

India's Companies Act generally restricts a subsidiary from holding shares in its holding company, with exceptions for certain existing holdings. It also restricts the voting rights associated with some of those holdings.

That means the eventual structure must deal carefully with the circular ownership created when a company tries to move its parent beneath itself.

The other major question concerns minority shareholders. Shalimar investors originally purchased shares in a paint manufacturer. They are now being offered exposure to a much larger construction-materials group carrying significant borrowings.

The valuation could prove attractive, but the risks are different. The public shareholders have a legitimate interest in the exchange price, the debt they may indirectly acquire, the future management structure and the amount by which their ownership is diluted.

The American regulator has already dealt with comparable concerns. In January 2024, the US Securities and Exchange Commission tightened SPAC regulations, demanding more disclosures around conflicts of interest, dilution, financial forecasts and the companies entering public markets.

India's SEBI could eventually take a similar approach if reverse combinations become common. Rather than banning them, it could require more detailed disclosures, independent fairness assessments, additional minority-shareholder protections or eligibility conditions where a listed company's principal business changes substantially.

The likely regulatory concern would be that a private company should not escape important public-market protections simply because it enters through a listed company rather than an IPO.

Among Indian startups, PharmEasy offers perhaps the most interesting comparison.

Its parent, API Holdings, acquired control of listed diagnostics company Thyrocare in 2021. The arrangement created a structure resembling the relationship between Infra.Market and Shalimar: a private technology-enabled business with a listed operating subsidiary.

On paper, the opportunity appears attractive. PharmEasy could potentially use Thyrocare as a route to a broader public listing, combining pharmacy distribution, healthcare services and diagnostics.

There is even an established public market for the listed company's shares.

However, Thyrocare's management has explained why such a deal is not currently being pursued.

During an October 29, 2026 earnings call, CEO Rahul Guha was asked directly about a possible reverse merger with API Holdings.

He said the group was not evaluating a reverse merger or IPO at that stage. API Holdings had achieved one important milestone by becoming debt-free, but its business excluding Thyrocare had not yet reached profitability. Management expected that milestone around the fourth quarter of FY2027.

Guha also acknowledged a basic problem. Thyrocare was performing well and generating profits, while the wider API business remained loss-making. Convincing Thyrocare's minority shareholders to approve such a combination would be difficult.

This is probably the most useful comparison for understanding Infra.Market.

PharmEasy has access to a listed subsidiary, but that does not mean it can automatically use the subsidiary to bring its larger business to market. Existing public shareholders have interests of their own.

If API Holdings becomes profitable, the conversation may change. Until then, its management has made clear that a reverse merger is not an announced plan.

Other businesses worth examining include OfBusiness and Udaan, both of which operate in sectors where working capital, credit and institutional financing matter. Their business models make alternative routes to public capital worth considering, particularly if an attractive listed acquisition becomes available.

There is no evidence from the transactions discussed here that either is pursuing such a structure. They are examples of the type of business that might find the economics appealing, rather than predictions of imminent deals.

The more likely candidates are startups that already control listed subsidiaries. Buying a listed company solely for its stock-market presence can create more problems than it solves, especially if the company has legacy liabilities, complicated ownership or poor trading liquidity.

My expectation is that India will see more such transactions, although not enough to replace conventional IPOs.

The reason is fairly straightforward. Over the past decade, Indian startups have raised enormous amounts of private capital. Many of those investors are now reaching the stage where they need to realise returns.

At the same time, not every venture-backed company can attract an attractive public-market valuation. Some have substantial revenue but modest profits. Others operate in capital-intensive sectors where debt and working capital complicate their investment appeal.

For these businesses, a reverse listing could offer a useful alternative, particularly where the group already owns a compatible listed company.

The financial benefits can extend beyond investor exits. A listed company may be able to raise money from institutions, acquire businesses with its shares, broaden its shareholder base and potentially secure financing on more attractive terms.

But most startups will still prefer a conventional IPO when conditions are favourable.

A successful IPO brings fresh capital, establishes a publicly negotiated valuation and creates a clearer ownership structure. It can also generate enough institutional participation to support meaningful trading after listing.

A reverse listing does not necessarily deliver any of those benefits automatically. In a weak transaction, it may produce a company with a complicated structure, limited liquidity, substantial dilution and a valuation investors refuse to support.

For that reason, I would expect perhaps two to five significant reverse-listing transactions involving Indian startups over the next three or four years, assuming the Infra.Market and comparable transactions establish a workable precedent. That is an educated estimate, not a forecast based on announced deals.

The number could be higher if SEBI develops a clear framework and institutional investors become comfortable financing these companies. It could be lower if transactions face prolonged scrutiny or disappoint public shareholders.

Infra.Market's eventual outcome will influence those expectations.

Its biggest test is not whether it can complete the proposed share exchange. It is whether the enlarged Shalimar can attract sustained institutional interest, raise meaningful capital, manage its debt and offer investors enough liquidity to make the exercise worthwhile.

There is also a less obvious risk. Because Infra.Market already consolidates subsidiaries within its reported financial statements, investors cannot simply add all of Shalimar's revenue and profit to Infra.Market's figures and assume that the enlarged company has created additional economic value. Intercompany transactions, cross-holdings and the final ownership structure will need careful accounting.

And a listed holding company may trade at a discount to the estimated value of its subsidiaries if investors find the structure too complicated.

That brings us back to the difference between getting a company listed and persuading investors to value it highly.

Infra.Market has spent a decade building a sizeable business. Its nearly ₹20,000 crore revenue base, manufacturing operations and distribution network provide substantial assets for investors to examine. Yet its debt, modest net margin and financing requirements are equally important.

The reverse-listing proposal changes the path by which these assets and liabilities could reach public shareholders. It does not change the underlying economics.

For founders and venture funds, the attraction is understandable. Instead of submitting the business to a conventional IPO, they can negotiate an exchange with a company they already control and potentially create a route to public-market liquidity.

For ordinary shareholders, the question is rather different. They need to know whether the resulting company is worth owning at the price implied by the transaction.

And that is where India's experiment could become particularly interesting. If Infra.Market succeeds, other founders will study the structure carefully. If it struggles, the transaction may become a warning about the limits of financial restructuring.

After all, WeWork managed to reach the public market through a SPAC, while ReNew is now considering leaving it. Yatra demonstrated that a SPAC can provide substantial growth capital, and PharmEasy shows why owning a listed subsidiary does not automatically make a reverse merger attractive.

The lesson across these examples is consistent. A reverse listing can change the timing, ownership and mechanics of becoming public. It cannot create profitability, eliminate debt or guarantee investor demand.

Infra.Market may well establish a new route for mature Indian startups, especially those with large operations and existing listed subsidiaries. But the ultimate measure of success will not be the ₹10,440 crore swap or the ₹25,000 crore valuation.

It will be how much money the company can raise, how much debt it can reduce, and how much of the paper wealth held by its investors can eventually be converted into cash.

The IPO process may be avoidable. The judgment of public-market investors is not.