Enviro Infra Engineers IPO: Opens November 22 – Check Key Details

Enviro Infra Engineers IPO

Enviro Infra Engineers IPO: Opening November 22 – Key Details on Business, Financials, and Use of Funds

The Enviro Infra Engineers IPO is set to open on November 22, 2024, offering investors an opportunity to invest in one of India’s prominent players in water and wastewater treatment infrastructure.

The public offering will remain open for subscription until November 26, 2024. However, anchor investors will have a one-day window on November 21, 2024, to participate in the offering.

This highly anticipated IPO aims to raise significant capital, which will be used to fuel the company’s growth and expansion plans.

Below, we provide a comprehensive look at the key details of the Enviro Infra Engineers IPO, including its business operations, financial performance, the use of proceeds, and more.

Key Highlights of the Enviro Infra Engineers IPO

• Opening Date: November 22, 2024
• Closing Date: November 26, 2024
• Anchor Investor Window: November 21, 2024
• Price Band Announcement: November 18, 2024
• Fresh Equity Issued: 3.87 crore shares
• Offer for Sale (OFS): 52.68 lakh shares (by promoters)
• Employee Reservation: 1 lakh shares reserved for employees

Enviro Infra Engineers will be offering both fresh equity shares and an Offer for Sale (OFS) from existing promoters, with a combined total of around 4.4 crore shares to be made available to the public.

This IPO will help the company raise funds to expand its operations, repay debts, and fund capital expenditures related to new projects.

Offer Structure and Allocation

The IPO will be allocated as follows:

• 50% of the net issue will be reserved for Qualified Institutional Buyers (QIBs), which includes financial institutions, mutual funds, and foreign institutional investors.
• 15% will be allocated to Non-Institutional Investors (NIIs), which generally includes high-net-worth individuals and large investors.
• 35% will be reserved for Retail Investors, who make up a significant portion of the investing public.
• Employee Reservation: The company has set aside 1 lakh shares for its employees, providing them with an opportunity to invest in the IPO at a discounted rate.

The company’s decision to reserve a portion of the offering for its employees is likely to increase employee engagement and align their interests with those of shareholders, which is generally seen as a positive sign by the market.

Use of Funds Raised Through the IPO

Enviro Infra Engineers plans to use the funds raised through this IPO for several strategic purposes aimed at expanding its business and strengthening its financial position:

1. Working Capital Requirements (Rs 181 crore): A significant portion of the funds, Rs 181 crore, will be allocated towards meeting the company’s working capital needs. This will enable the company to maintain liquidity and fund its ongoing projects without relying heavily on external borrowings.
2. Construction of 60 MLD STP in Mathura, Uttar Pradesh (Rs 30 crore): A key part of the IPO proceeds, Rs 30 crore, will be used for the construction of a 60 MLD (Million Liters per Day) Sewage Treatment Plant (STP) in Mathura, Uttar Pradesh. This project will be executed through the company’s subsidiary, EIEL Mathura Infra Engineers, and is expected to strengthen the company’s position in the water treatment sector.
3. Debt Repayment (Rs 120 crore): Rs 120 crore will be utilized to repay existing debt, which will help reduce interest costs and improve the company’s financial leverage.
4. Inorganic Growth & General Corporate Purposes (Remaining funds): The remaining funds will be used for inorganic growth through acquisitions of other companies or assets, which can help Enviro Infra Engineers expand its market share. The funds will also be used for general corporate purposes, which could include marketing, business development, or other operational expenses.

Business Overview of Enviro Infra Engineers

Founded and promoted by the Jain family in Delhi, Enviro Infra Engineers is a leading player in India’s water treatment and wastewater management sector.

The company primarily specializes in the design, construction, operation, and maintenance of water and wastewater treatment plants, as well as water supply schemes for government authorities and municipal bodies.

Over the past seven years, Enviro Infra Engineers has developed 28 projects across India, primarily focusing on the public sector.

The company has built a reputation for delivering complex water and wastewater infrastructure projects, including Sewage Treatment Plants (STPs), Effluent Treatment Plants (ETPs), and water supply systems.

As of June 2024, the company has a robust order book worth Rs 1,906.3 crore, with 21 ongoing projects across the country.

This reflects the significant demand for water treatment and sewage infrastructure in India, as the government continues to focus on improving water quality and environmental sustainability.

The company has also been working on Zero Liquid Discharge (ZLD) systems for many of its projects, which ensures that treated water can be safely reused for industrial and commercial purposes, such as gardening, washing, and refrigeration.

Enviro Infra Engineers competes with several established players in the market, including Va Tech Wabag, Vishnu Prakash R Pungalia, EMS and ION Exchange.

The company’s focus on sustainability and environmentally friendly technologies, such as ZLD and advanced water purification systems, has helped it gain a competitive edge in a market that is rapidly evolving.

Financial Performance

Enviro Infra Engineers has shown impressive financial growth in recent years, with strong revenue and profit growth.

• FY 2024 Financials: The company reported a net profit of Rs 110.5 crore in FY 2024, marking an impressive 101% increase from Rs 55 crore in FY 2023. This strong profit growth highlights the company’s ability to execute large-scale projects efficiently and manage costs effectively.
• Revenue Growth: The company’s revenue surged by 115.6% in FY 2024, rising from Rs 338.1 crore in FY 2023 to Rs 728.9 crore in FY 2024. This growth is primarily driven by the execution of several large water treatment projects, as well as an increase in demand for water infrastructure in India.
• Quarterly Financials: For the quarter ending June 2024, the company reported a profit of Rs 30.8 crore on a revenue of Rs 205.6 crore, demonstrating a solid performance even in the early part of FY 2024.

Investment Details

• Book-Running Lead Manager: Hem Securities.
• Registrar to the Offer: Bigshare Services.

The strong growth in both revenue and profit, along with the company’s solid order book, positions Enviro Infra Engineers as an attractive investment opportunity for those looking to invest in the infrastructure and water treatment sectors.

Final Remarks

The Enviro Infra Engineers IPO offers a compelling investment opportunity for retail and institutional investors alike, given the company’s strong growth prospects, robust order book, and strategic focus on water and wastewater infrastructure in India.

With a solid financial track record, a well-established market presence, and a diversified order pipeline, the company is well-positioned to capitalize on the growing demand for clean water and wastewater treatment solutions across the country.

As India continues to invest in its infrastructure, Enviro Infra Engineers is poised for long-term growth, making this IPO one to watch for those interested in the burgeoning infrastructure and sustainability sectors.