BuildMart — Investment Structure & Use of Funds
The ZAR 450 million capital requirement, a detailed use of funds, and the investor return analysis for equity and debt participants.
Section 12 · Business Plan
Investment Structure & Use of Funds
The ZAR 450 million capital requirement, a detailed use of funds, and the investor return analysis for equity and debt participants.
12.1 Capital Requirement
Total capital requirement is ZAR 450 million, structured as ZAR 270
million equity (60%) and ZAR 180 million debt (40%). The equity
component provides the risk capital necessary for store rollout and
initial operating losses, while the debt component is structured as a
5-year term loan secured against property, equipment, and inventory.
Additional debt facilities of up to ZAR 126 million will be drawn in
Years 2–3 to fund accelerated expansion, subject to covenant compliance
and demonstrated unit economics.
12.2 Detailed Use of Funds
| Category | Amount (ZAR M) | % of Total | Description |
|---|---|---|---|
| Store Rollout | 247.5 | 55% | Leasehold improvements, fit-out, signage |
| Inventory Capitalisation | 112.5 | 25% | Opening stock for 5 stores + DC |
| Logistics & Warehousing | 45.0 | 10% | DC setup, fleet, material handling |
| Technology & ERP | 22.5 | 5% | ERP, POS, e-commerce, analytics |
| Working Capital | 22.5 | 5% | Operating cash buffer, trade credit |
| Total | 450.0 | 100% |
12.3 Investor Return Analysis
Based on the base-case financial projections, equity investors can
expect an internal rate of return (IRR) of 28–32% over a 7-year
investment horizon. The investment multiple (MOIC) is projected at
3.8–4.5x over the same period. Dividend distributions are expected to
commence from Year 4, with an initial payout ratio of 15–20% of net
profit, increasing to 25–30% as the balance sheet strengthens and
capital expenditure requirements moderate. The projected Year 7 EBITDA
of ZAR 700 million implies an enterprise value of ZAR 4.2–5.6 billion at
industry-comparable EV/EBITDA multiples of 6–8x, representing
significant value creation for founding investors.
Confidential — this business plan is provided to prospective investors and lenders for evaluation purposes only and may not be reproduced or distributed without the written consent of BuildMart (Pty) Ltd.