Enviro Infra Engineers IPO: GMP, review, other details of upcoming IPO opening this week

Enviro Infra Engineers IPO opens for subscription on Friday, November 22. Established in 2009, Enviro Infra Engineers Limited specialises in designing, building, operating, and maintaining water and Waste-Water Treatment Plants (WWTPs) and water supply projects (WSSPs) for government agencies/entities.

The company engages in bids from state governments and urban local bodies (ULBs) to build WWTPs and WSSPs using Engineering, Procurement, and Construction (EPC) or Hybrid Annuity Model (HAM) models. By June 30, 2024, the company has effectively built 28 WWTPs and WSSPs in India over the past seven years, which includes 22 projects with a capacity of 10 MLD or more.

The company competes in EPC or HAM tenders from state governments and ULBs for building WWTPs and WSSPs. By June 30, 2024, the company had effectively built 28 WWTPs and WSSPs in India over the past seven years, with 22 of them having a capacity of 10 MLD or more. As at June 30, 2024, there are 21 WWTPs and WSSPs in the company's order book with a total worth of ₹1,90,628.06 lakhs.

As per the red herring prospectus (RHP), the company's listed peers are EMS Ltd (with a P/E of 25.92), ION Exchange Ltd (with a P/E of 38.68), Va Tech Wabag Ltd (with a P/E of 43.90), and Vishnu Prakash R Punglia Ltd (with a P/E of 25.31).

Over the last two fiscal years, the company has recorded a consolidated total income and net profit of Rs. 225.62 crore and Rs. 34.55 crore for FY22, Rs. 341.66 crore and Rs. 55.34 crore for FY23, and Rs. 738.00 crore and Rs. 108.57 crore for FY24. In the first quarter of FY25, which concluded on June 30, 2024, the company announced a net profit of Rs. 29.97 crore alongside a total income of Rs. 207.46 crore, reflecting a notable increase in both revenue and profit compared to FY24.

Sanjay Jain, Manish Jain, Ritu Jain, and Shachi Jain are the company's stakeholders. In total, the promoters own 3,70,94,280 equity shares with a face value of ₹10 each in their Company, making up 99.97% of the pre-offer issued, subscribed, and paid-up equity share capital of the company.

Enviro Infra Engineers IPO - Key details

Here are the 10 key things to know about Enviro Infra Engineers IPO:

Enviro Infra Engineers IPO date: The issue opens for subscription on Friday, November 22, and closes on Tuesday, November 26.

Anchor Details: The allocation to anchor investors for Enviro Infra Engineers IPO is scheduled to take place tomorrow (Thursday, November 21).

Enviro Infra Engineers IPO price band: The IPO price band has been fixed in the range of ₹140 to ₹148 per equity share of face value of ₹10.

Enviro Infra Engineers IPO lot size: The IPO lot size is 101 equity shares and in multiples of 101 equity shares thereafter.

Enviro Infra Engineers IPO details: The Enviro Infra Engineers IPO includes a fresh issuance of 3.87 crore equity shares and a sale of 52.68 lakh shares by the selling shareholders (promoters).

Hem Securities Ltd serves as the book running lead manager for the IPO of Enviro Infra Engineers, whereas Bigshare Services Pvt Ltd acts as the registrar for this offering.

Enviro Infra Engineers IPO objective: The company plans to utilise the funds raised from the new offering for various purposes such as meeting Working Capital Requirements, supporting its subsidiary EIEL Mathura in constructing 60 MLD STP for the 'Mathura Sewerage Scheme', repaying current debts, and enabling growth through potential acquisitions and general corporate needs.

Enviro Infra Engineers IPO listing date and allotment details: The allocation of shares for the Enviro Infra Engineers IPO is scheduled to be determined on Wednesday, November 27. Refunds will be processed on the same day, and shares will be deposited into the demat accounts of allottees on Thursday, November 28 after the refund. Enviro Infra Engineers share price is likely to be listed on BSE and NSE on Friday, November 29.

Enviro Infra Engineers IPO reservation: Enviro Infra Engineers IPO has reserved not more than 50% of the shares in the public issue for qualified institutional buyers (QIB), not less than 15% for non-institutional Institutional Investors (NII), and not less than 35% of the offer is reserved for retail investors. The employee portion has been reserved up to 1,00,000 equity shares and a discount of ₹13 per share is being offered to eligible employees.

Enviro Infra Engineers IPO Review: "We recommend to subscribe the IPO with a long-term perspective. Over the last three fiscal years, the company has maintained an average EPS of Rs. 5.95 and an average RoNW of 41.44%. The issue price is set at a P/BV of 6.27 based on a NAV of ₹23.60 as of June 30, 2024, and a P/BV of 2.90 based on a post-IPO NAV of ₹51.01 per share (at the upper cap).

If annualised FY25 earnings are attributed to the post-IPO fully diluted equity base, the asking price corresponds to a P/E ratio of 21.67, and based on FY24 earnings, the P/E ratio stands at 23.90, suggesting the IPO is fully priced. However, the debt of ₹305 crore as of June 30, 2024, raises some concerns," said Bajaj Broking in its report.

Enviro Infra Engineers IPO GMP today: Enviro Infra Engineers IPO GMP today or grey market premium is +31. This indicates Enviro Infra Engineers share price were trading at a premium of ₹31 in the grey market on Wednesday, according to investorgain.com.

Considering the upper end of the IPO price band and the current premium in the grey market, the estimated listing price of Enviro Infra Engineers share price was indicated at ₹179 apiece, which is 20.95% higher than the IPO price of ₹148.

According to the grey market trends of the last 4 sessions, today's IPO GMP is showing an upward trend and is expected to have a successful listing. According to investorgain.com experts, the minimum GMP is ₹0, and the maximum GMP is ₹31.

'Grey market premium' indicates investors' readiness to pay more than the issue price.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.