| Price | Lot Size | Issue Date | Issue Size |
|---|---|---|---|
| ₹ 140 to ₹ 148 | 101 | 22nd Nov, 2024 – 26th Nov, 2024 | ₹ 650.43 Cr |
About Enviro Infra Engineers Ltd IPO
Enviro Infra Engineers Ltd. (EIEL) is a leading Indian company specializing in the design, construction, operation, and maintenance of Water and Wastewater Treatment Plants (WWTPs) and Water Supply Scheme Projects (WSSPs) for government authorities and public sector bodies. The company’s portfolio includes projects such as Sewage Treatment Plants (STPs), Common Effluent Treatment Plants (CETPs), Sewerage Schemes (SS), and Water Treatment Plants (WTPs), along with associated infrastructure like pumping stations and pipeline networks. EIEL’s projects are largely funded through Central Government schemes such as AMRUT, NMCG, and JJM, in collaboration with state governments and Urban Local Bodies (ULBs). With over seven years of experience, EIEL has successfully developed 28 WWTPs and WSSPs, including 22 projects with capacities of 10 MLD and above. The company operates with an in-house team of 180 engineers, complemented by third-party consultants and industry experts, enabling it to maintain high standards of quality and compliance. EIEL’s service offerings span the entire project lifecycle – from design and procurement to site execution, commissioning, and post-commissioning operations and maintenance. In addition to its independent project execution, EIEL also enters into joint ventures with other infrastructure firms to enhance technical and financial capabilities for bidding on large-scale projects. The company is committed to sustainability, integrating solar power and Compressed Bio Gas (CBG) plants into its projects to reduce carbon emissions and promote environmental sustainability. As of June 30, 2024, EIEL’s order book stood at Rs. 1,906.3 crores, and employs 939 people. The company’s comprehensive product mix and focus on wastewater treatment solutions have enabled it to maintain strong margins and position itself for continued growth in the infrastructure sector.
Objective of the Enviro Infra Engineers Ltd IPO
The company proposes to utilize proceeds from the fresh issue towards funding the following objectives:
- To meet the working capital requirements;
- Infusion of funds in the subsidiary, EIEL Mathura Infra Engineers Pvt. Ltd. (EIEL Mathura) to build 60 MLD STP under the project titled ‘Mathura Sewerage Scheme” at Mathura in Uttar Pradesh through hybrid annuity based PPP mode;
- Repayment/prepayment in full or in part, of certain of the outstanding borrowings; and
- Funding inorganic growth through unidentified acquisitions and general corporate purposes.
Rationale To Invest In Enviro Infra Engineers Ltd IPO
Strong in-house capabilities and technological expertise positions it well in an emerging sector
EIEL has strong in-house capabilities in designing, engineering, and executing complex water and wastewater treatment projects. With a team of 180 skilled engineers, the company reduces its reliance on third-party consultants, ensuring greater control over project quality and timelines. EIEL’s engineering expertise covers a wide range of technologies for designing and implementing Sewage Treatment Plants (STPs), Common Effluent Treatment Plants (CETPs), and Water Supply Scheme Projects (WSSPs). EIEL’s strong technical capabilities, reputation for delivering high-quality projects on time, and its established expertise in design, engineering, construction, and operations have made it a competitive player in the industry. The company’s use of advanced technologies such as Sequential Batch Reactors (SBR), High Rate Anaerobic Digestors (HRAD), and Moving Bed Biological Reactors (MBBR), along with Biological Nutrient Removal (BNR) systems, enables it to meet stringent environmental regulations while delivering cost-effective solutions. EIEL also employs tertiary treatment processes like UV treatment, activated carbon filters, and ultra-filtration, ensuring high water quality and Zero Liquid Discharge (ZLD) compliance across its plants. The company’s established track record of completing complex projects on time, along with its comprehensive approach to project execution – from design to operations and maintenance – enhances its ability to win high-value tenders and secure steady cash flows. These capabilities, combined with a focus on technological innovation and operational efficiency, position EIEL to capitalize on the growing water and wastewater treatment sector.
Diversified order book of projects across India provides revenue visibility going ahead
EIEL has built a diversified and robust order book, with a total of 21 projects currently under execution across India, valued at Rs. 1,906.3 crores as of June 30, 2024. These projects are strategically distributed across various types of water and wastewater treatment plants, reflecting the company’s extensive expertise in the sector. The order book includes nine Sewage Treatment Plants (STPs), all being executed on an EPC basis, one Common Effluent Treatment Plant (CETP), also under the EPC model, five Sewerage Schemes (SS) projects, and five Water Supply Scheme Projects (WSSPs), all of which are being executed on an EPC basis. Additionally, there is one project under the Hybrid Annuity Model (HAM), specifically for an STP. The company’s ability to execute projects across both EPC and HAM models enables it to leverage multiple revenue streams, which bolsters its growth and financial stability. Moreover, the inclusion of Operations and Maintenance (O&M) services in many of its projects ensures consistent cash flows, adding to its profitability. With such a varied and growing order book, EIEL is well-positioned for continued growth in the water and wastewater treatment space.
Valuation of Enviro Infra Engineers Ltd IPO
India’s water and wastewater treatment sector is expanding rapidly, driven by increasing water demand, urbanization, and government initiatives such as the Hybrid Annuity Model (HAM) and Namami Gange. EIEL is well-positioned to capitalize on this growth, with a strong order book of Rs. 1,906.3 crores as of June 30, 2024, and a proven track record of executing high-quality projects across India. The company specializes in designing, constructing, and maintaining water treatment plants, including Sewage Treatment Plants (STPs), Common Effluent Treatment Plants (CETPs), and Water Supply Scheme Projects (WSSPs). With 180 in-house engineers and advanced technologies like Sequential Batch Reactors (SBR) and Moving Bed Biological Reactors (MBBR), EIEL consistently delivers complex projects on time, maintaining a competitive edge. Its diversified portfolio of 21 ongoing projects, combined with its focus on EPC and HAM models, enhances its revenue streams. The company is also integrating sustainable practices, such as solar power and Compressed Biogas (CBG) plants, into its projects to align with growing environmental concerns. However, EIEL faces certain risks, including its reliance on government contracts awarded through competitive bidding, high working capital requirements, and contingent liabilities totalling Rs. 2,588.3 million. Financially, the company has demonstrated consistent growth, with a revenue CAGR of 80.6%, increasing from Rs. 2,235 million in FY22 to Rs. 7,289 million in FY24, and a profit CAGR of 78.9%, from Rs. 345 million in FY22 to Rs. 1,086 million in FY24. The company’s stable growth, along with a debt-equity ratio of 0.95x as of June 30, 2024, positions it to fund strategic initiatives and pursue further expansion opportunities. The current issue is priced at a P/E of 18.2x on the upper band, based on FY24 earnings, which is relatively lower than its peers. Given the company’s strong technological capabilities and its focus on growth strategies such as geographical expansion and waste-to-energy initiatives, the company is well-positioned for continued business traction. Therefore, we recommend a “SUBSCRIBE” rating for the issue, with a medium- to long-term investment perspective.
What is the Enviro Infra Engineers Ltd IPO?
Enviro Infra Engineers IPO is a book built issue of Rs 650.43 crores. The issue is a combination of fresh issue of 3.87 crore shares aggregating to Rs 572.46 crores and offer for sale of 0.53 crore shares aggregating to Rs 77.97 crores. Login to your account now.
How to apply for the Enviro Infra Engineers Ltd IPO through StoxBox?
To apply for the Enviro Infra Engineers Ltd IPO through StoxBox one can apply from the website and also from the app. Click here
When will the Enviro Infra Engineers Ltd IPO open?
Enviro Infra Engineers Ltd IPO is opening on 22nd November 2024. Apply Now
What is the lot size of the Enviro Infra Engineers Ltd IPO?
The Lot Size of Enviro Infra Engineers Ltd IPO is 101 equity shares. Login to your account now
When is the Enviro Infra Engineers Ltd IPO allotment date?
The allotment Date for Enviro Infra Engineers Ltd IPO is 27th November 2024. Login to your account now.
When is the Enviro Infra Engineers Ltd IPO listing date?
The listing Date for Enviro Infra Engineers Ltd IPO is 29th November 2024. Login to your account now
What is the minimum investment required for the Enviro Infra Engineers Ltd IPO?
In the Retail segment the minimum investment required is Rs. 14,948. Login to your account now
What is the maximum investment allowed for the Enviro Infra Engineers Ltd IPO?
In the Retail segment the maximum investment requirement is Rs. 194,324. Login to your account now
What are the risks associated with investing in the Enviro Infra Engineers Ltd IPO?
- The company relies heavily on winning government-awarded projects through competitive bidding. While it meets technical and financial qualifications for CETP and up to 200 MLD STP projects, there is no guarantee it will qualify for or win future projects. Changes in qualification criteria, project delays, or legal disputes could adversely affect its ability to secure contracts. If the company fails to qualify independently or partner effectively, it may hinder growth and negatively impact its revenue, operations, and profitability.
- The company requires high working capital, which could impact operations if cash flows are insufficient. Delays in client payments, changes in terms, or project delays may increase financial burden. Reliance on debt, bank guarantees, and receivables could strain finances.
- As of June 30, 2024, the company had contingent liabilities totalling Rs. 2,588.3 million, including demands from tax authorities, TDS defaults, and bank guarantees. These liabilities are not provided for in the financial statements. If they materialize, the company may face significant financial strain, adversely impacting its condition and operations.
When will the Enviro Infra Engineers Ltd IPO shares be credited to my Demat account?
The Enviro Infra Engineers Ltd IPO be credited to the account on allotment date which is 28th November 2024. Login to your account now
Where can I find the Enviro Infra Engineers Ltd IPO prospectus?
The prospectus of Enviro Infra Engineers Ltd IPO prospectus can be find on the website of SEBI, NSE and BSE
What are the important dates related to Enviro Infra Engineers Ltd IPO?
| IPO Open Date | Friday, November 22, 2024 |
| IPO Close Date | Tuesday, November 26, 2024 |
| Basis of Allotment | Wednesday, November 27, 2024 |
| Initiation of Refunds | Wednesday, November 27, 2024 |
| Credit of Shares to Demat | Thursday, November 28, 2024 |
| Listing Date | Friday, November 29, 2024 |
| Cut-off time for UPI mandate confirmation | 5 PM on November 26, 2024 |
