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IPO

Enviro Infra Engineers Ltd

Enviro Infra Engineers Ltd IPO

Status: Closed

Overview

IPO date

22 Nov 2024 to 26 Nov 2024

Face value

₹ 10 per share

Price

₹ 140 to ₹148 per share

Issue Size

43948000 shares
(aggregating up to ₹ 650.43 Cr)

Allotment Date

27 Nov 2024

Listing at

NSE

Issue type

Book Building

Sector

Infrastructure Developers & Operators

Objectives of Enviro Infra Engineers Ltd IPO

Initial public offering of up to 4,39,48,000 equity shares of face value of Rs. 10 each ("Equity Shares") of Enviro Infra Engineers Limited ("The Company" or "Issuer") for cash at a price of Rs. 148 per equity share (including a premium of Rs. 138 per equity share) ("Offer Price") aggregating up to Rs. 650.30 crores ("Offer"). The offer comprises a fresh issue of up to 3,86,80,000 equity shares aggregating up to Rs. 572.35 crores ("Fresh Issue") and an offer for sale of up to 21,34,000 equity shares aggregating up to Rs. 31.58 croress by Sanjay Jain, up to 21,34,000 equity shares aggregating up to Rs. 31.58 crores by Manish Jain, up to 5,00,000 equity shares aggregating up to Rs. 7.40 crors by Ritu Jain and , up to 5,00,000 equity shares aggregating up to Rs. 7.40 crores by Shachi Jain (collectively, "Promoter Selling Shareholders" and such offer for sale by the promoter selling shareholders, "Offer for Sale"). The offer includes a reservation of up to 1,00,000 equity shares, aggregating up to Rs. 1.35 crores constituting up to 0.06% of the post-offer paid-up equity share capital, for subscription by eligible employees ("Employee Reservation Portion"). The company may, in consultation with the brlm, offer a discount equivalent of Rs. 13 per equity share to the eligible employees bidding in the employee reservation portion ("Employee Discount"). The offer less the employee reservation portion is hereinafter referred to as the net offer. The offer and the net offer shall constitute 25.04 % and 24.98 % of the post-offer equity share capital of the company. The face value of the equity share is Rs. 10 each. The issue price is. 14.8 times of the face value of the equity shares. A discount of Rs. 13 per equity share is being offered to eligible employees bidding in the employee reservation portion.

Objectives of Enviro Infra Engineers Ltd IPO

Enviro Infra Engineers Ltd IPO Strategy

About Enviro Infra Engineers Ltd

Enviro Infra Engineers Limited was originally incorporated as Enviro Infra Engineers Private Limited' at Delhi on June 19, 2009. Thereafter on April 1, 2010, Company took over the business of Partnership Firm, 'M/s Enviro Engineers' and its name was changed from Enviro Infra Engineers Private Limited' to Enviro Infra Engineers Limited' consequent upon conversion of Company from Private to Public Company and a fresh Certificate of Incorporation was issued by RoC, Delhi on August 8, 2022. The Company is into the business of designing, construction, operation and maintenance of Water and Wastewater Treatment Plants (WWTPs) and Water Supply Scheme Projects (WSSPs) for Government authorities/bodies. WWTPs include Sewage Treatment Plants (STPs) along with Sewage Network Schemes and Common Effluent Treatment Plants (CETPs) and WSSPs include Water Treatment Plants (WTPs) along with pumping stations and laying of pipelines for supply of water. The treatment process installed at most of the STPs and CETPs is Zero Liquid Discharge (ZLD) compliant and the treated water can be used for horticulture, washing, refrigeration and other process industries. Its primary focus is to strengthen prospects in executing WWTP and WSSP projects. WWTPs and WSSPs are partly funded by the Central Government under schemes like the Atal Mission for Rejuvenation and Urban Transformation (AMRUT) and National Mission of Clean Ganga (NMCG) for projects in urban areas. WSSPs are funded by the Central Government schemes like the Jal Jeevan Mission (JJM) for rural areas of the country. The States or Urban Local Bodies (ULBs) under their respective schemes fund the WWTPs and WSSPs along with the Central Government. The Company bids for tenders issued by State Governments and ULBs for developing WWTPs and WSSPs on an EPC (Engineering, Procurement, and Construction) or HAM (Hybrid Annuity Model) basis. So far, it commissioned nearly 22 Projects having more than 10 million liters per day (MLD) capacity across states of Gujarat, Rajasthan, Punjab, Haryana, Uttarakhand and Chhattisgarh. After the takeover of business of Partnership Firm, 'M/s Enviro Engineers' in April, 2010, the Company set up a Common Effluent Treatment Plant (CETP) 18 MLD capacity of Rs. 15.96 crore, on turnkey basis, at Balotra, Rajasthan. In 2013, it commissioned 2 MLD STP at Bathinda, Punjab, for Rs. 31.03 crores. It set up 5 MLD CETP at Saha and 10 MLD CETP at Rohtak in Haryana from Haryana State Industrial and Infrastructure Development Corporation for an aggregate value of Rs. 3,7.10 crores in 2014. It commissioned 21 MLD CETP of Rs. 49.5 crore in Panipat, Haryana in 2016. It completed 29 MLD STP at Khanna, District. Ludhiana in 2017. In 2021, a new subsidiary, 'EIEPL Bareilly Infra Engineers Private Limited' was formed. The Company further acquired EIEL Mathura Infra Engineers Private Limited as a subsidiary in 2023. The Company launched an Initial Public Issue of 4,39,48,000 Equity Shares of Face Value of Rs 10 each by raising funds aggregating to Rs 650 Crore consisting a Fresh Issue of 3,86,80,000 Equity Shares amounting to Rs 572 Crore and 52,68,000 Equity Shares amounting to Rs 780 Crore through Offer for Sale in November, 2024. The Company completed the construction of 1000 KLD STP at Jind Haryana in June, 2024. It installed and commissioned a 1 MW solar power plant at 30 MLD STP Project in Kota and a 800 KW solar power plant at 42 MLD, 20 MLD & 1 MLD STP project at Bareilly, making them operational in 2024. The Company incorporated Enviro Infra Engineers (Saharanpur) Private Limited (EIEL Saharanpur) as the biggest project effective on March 8, 2024.

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Strengths vs Risks of Enviro Infra Engineers Ltd

Know the pros & cons

Strengths

In house designing, engineering and execution team 180 engineers.
Increasing presence in existing geographies such as Gujarat, Rajasthan, Punjab, Karnataka, Haryana, Uttar Pradesh, Madhya Pradesh and Chhattisgarh with new projects.
Diversified Order Book of 21 projects across India for an aggregate value of Rs.1,90,628.06 lakhs as of June 30, 2024 across India.
In-house execution capabilities with timely delivery and established track record enabling consistent increase in eligibility for high value project tenders
Use of advanced technologies in the construction and installation of WWTPs and WSSPs.
Experienced Promoters and senior management team.
Consistent financial performance.

Risks

The company bid for Water and Wastewater Treatment Plants (WWTPs) & Water Supply Scheme Projects (WSSPs) funded by the Central and State Governments and derives the company revenues from the contracts awarded to it. Any reduction in budgetary allocation to this sector may affect the number of projects that the government authorities /bodies may plan to develop in a particular period. Its business is directly and significantly dependent on projects awarded by them.
Its projects are awarded through the competitive bidding process by government authorities/bodies. The company may not be able to qualify for, compete and win future projects, which could adversely affect its business and results of operations.
The company relies on its in-house designing, engineering and construction teams for project execution. Loss of employee(s) may have an adverse effect on the execution of its projects.
Its business is working capital intensive. If the company experience insufficient cash flows to meet required payments on its working capital requirements, there may be an adverse effect on the results of its operations.
Its Order Book shall mean estimated contract value of the unexecuted portion of the company existing assigned EPC/ HAM contracts and is an indicator of visibility of its future revenue and it may not be representative of the company future results and its actual income may be significantly less than the estimates reflected in the company Order Book, which could adversely affect its results of operations.
Failures to capitalize on government policy initiatives in the water and wastewater treatment market.
The company relies on various third parties in the civil construction activities for installing its Water and Wastewater Treatment Plants (WWTPs) & Water Supply Scheme Projects (WSSPs) and factors affecting the performance of their obligations could adversely affect the company projects.
The company relies on joint venture partners for selective government projects bids and execution of awarded projects. As on June 30, 2024, the company has developed 9 WWTPs and WSSPs across India in past seven (7) years through its Joint Ventures aggregating to Rs.33,373.00 lakhs. Further, its Water and Wastewater Treatment Plants (WWTPs) projects and Water Supply Scheme Projects (WSSPs) projects to be developed through the company joint ventures comprises of 66,454.15 lakhs constituting 34.86% of its Order Book as of June 30, 2024. The failures of a joint venture partner to perform its obligations could impose additional financial and performance obligations resulting in reduced profits or, in some cases, significant losses from the joint venture and may have an adverse effect on its business, results of operations and financial condition. In the event that a claim, arbitration award or judgement is awarded against the consortium, its may be responsible for the entire claim.
The company has diversified its offerings with "Waste to Energy" additions like Solar Power Plants and Compressed Bio Gas (CBG) forming a part of projects. The company may fails in implementing these initiatives successfully which may affect its future growth and prospects.
The company has experienced negative cash flows in the past and may continue to do so in the future and the same may adversely affect its cash flow requirements, which in turn may adversely affect its ability to operate the company's business and implement its growth plans, thereby affecting the company financial condition.
Increase in the prices of construction materials and labour & works contract charges could have an adverse effect on its business, results of operations and financial condition.
Its actual cost in executing Water and Wastewater Treatment Plants (WWTPs) & Water Supply Scheme Projects (WSSPs) may vary substantially from the assumptions underlying our bid or estimates. The company may be unable to recover all or some of the additional costs and expenses, which may have a material adverse effect on its results of operations, cash flows and financial condition.
The company deploy advanced technologies in the designing and installation of Water and Wastewater Treatment Plants (WWTPs) & Water Supply Scheme Projects (WSSPs). Any incapability to adopt a new technology or change in the requirement of a particular technology by the government authorities may affect its position to bid for Water and Wastewater Treatment Plants (WWTPs) & Water Supply Scheme Projects (WSSPs).
The company has certain contingent liabilities that have not been provided for in its restated consolidated financial statements, which if realised, could adversely affect the company financial condition.
An inability to comply with repayment and other covenants in the financing agreements or otherwise meet its debt servicing obligations could adversely affect the company's business, financial condition, cash flows and credit rating. Further, the company is subject to risks arising from interest rate fluctuations, which could reduce the profitability of its projects and adversely affect its business, financial condition and results of operations.
If the company fails to undertake Operation and Maintenance (O&M) works or if there is any deficiency of service regarding these works in the projects installed by it pursuant to and as per the relevant contractual requirements, its may be subject to penalties or even termination of the company contracts, which may have a material adverse effect on its reputation, business, financial condition, results of operations and cash flows.
Its may not be able to realise the amounts reflected in the company Order Book which may materially and adversely affect its business, prospects, reputation, profitability, financial condition and results of operation.
Its business is substantially dependent on the company design and engineering teams to accurately carry out the prebidding engineering studies for potential projects. Any deviation during the execution of the project as compared to its pre-bid estimates could have a material adverse effect on its cashflows, results of operations and financial condition.
Its business transactions are with government or government funded entities in India, which may expose it to risk, including additional regulatory scrutiny.
Water treatment or reuse and zero liquid discharge technology is subject to rapid change. These changes may affect the demand for its services. If the company is unable to keep abreast of the technological changes and new introductions its business, results of operations and financial condition may be adversely affected.
Its may be subject to liability claims or claims for damages or termination of contracts for failures to meet project completion timelines or defective work, which may adversely impact its profitability, cash flows, results of operations and reputation. However, there has been no instances of liability claims or claims for damages or termination of contracts due to failures to meet project completion timelines or defective work in the past except for claim of liquidated damages by Hindustan Zinc Limited due to delay in completion of 5 & 10 MLD STP at Udaipur due to reasons not attributable to the Company.
One of the Objects of the Offer is funding inorganic growth through unidentified acquisition and general corporate purposes. Its may utilize a portion of the Proceeds from the Fresh Issue to undertake inorganic growth for which the target may not be identified. The company has not made any strategic acquisitions in the past and inability to finalize such activities in a timely manner may delay its deployment of the Proceeds from the Fresh Issue and adversely affect its business and future growth.
Its business is exposed to various implementation risk and other uncertainties which may adversely affect the company's business, results of operations and financial condition.
The company has projects in diverse geographical regions which may expose it to various challenges.
Failures to increase the size of its projects and pre-qualification may affect the company growth prospects.
The company is required to furnish bank guarantees as part of its business. The company inability to arrange such guarantees or the invocation of such guarantees may adversely affect its cash flows and financial condition. As of June 30, 2024, the company had issued bank guarantees (including letter of credit) amounting to Rs. 25,700.32 lakhs towards securing its financial/ performance obligations under the company ongoing projects.
Any adverse revision to its credit rating by rating agencies may adversely affect the company ability to raise additional financing and the interest rates and other commercial terms at which such funding is available.
Its contracts with government authorities/bodies usually contain terms that favour them, who may terminate its contracts prematurely under various circumstances beyond its control and as such, the company has limited ability to negotiate terms of these contracts and may have to accept restrictive or onerous provisions. Its inability to negotiate terms that are favourable to it may have a material adverse impact on its financial condition and results of operations.
The company is dependent upon the experience and skill of its management team and a number of Key Managerial Personnel (KMP) and Senior Management Personnel (SMP). If the company is unable to attract or retain such qualified personnel, this could adversely affect its business, results of operations and financial condition.
Its failures to accurately forecast and manage inventory could result in an unexpected shortfall and/ or surplus of raw materials, equipment and manpower, which could affect its business and financial condition.
Unsecured loans of Rs. 4,918.38 lakhs taken by it can be recalled at any time.
The company is dependent on the recurring revenue from its operating and maintenance contracts, which is in almost all cases an inherent part of its EPC and HAM project contract. Cancellations of the company operating and maintenance contracts may adversely affect its business, financial condition, results of operations and prospects.
Any inability to maintain its equipment assets or manage the company employees or inadequate workloads may cause underutilization of its workforce and equipment, and such underutilization could reduce its ability to efficiently utilize its assets which may have an impact on the company profitability.
Any variation in the utilisation of the Proceeds from the Fresh Issue would be subject to certain compliance requirements, including prior shareholders' approval.
Its inability to protect or use intellectual property rights may adversely affect the company's business.
In the event of failures to complete of the projects or delay in execution of the projects, the company may not be able to recognize the revenue from the projects in its books of accounts.
Failures to achieve financial closures and funding arrangements within a stipulated period for Hybrid Annuity Model (HAM) projects may attract penalty and may also lead to termination of the contract.
Its inability to respond adequately to increased competition from organised and unorganised in its business may adversely affect the company's business, financial condition and results of operations.
There are outstanding legal proceedings involving the Company which may adversely affect its business, financial conditions, and results of operations.
If the company is unable to meet technical and financial qualification criteria laid down by the government authorities while submitting the bids for the project whether independently or together with other joint venture partners, its may not be able to qualify for, compete and win future projects which in turn will affect its growth prospects.
Industry information included in this Red Herring Prospectus has been derived from an industry report issued by Marketysers Global Consulting LLP dated October 11, 2024 ("Marketysers Report"). There can be no assurance that such third-party statistical, financial and other industry information is complete, reliable or accurate.
The Company has in the past entered into related party transactions with its Directors, Promoters and Promoter Group members/ entities, Subsidiaries, Group Company and joint ventures and may continue to do so in the future. There can be no assurance that such transactions, individually or in the aggregate, will not have an adverse effect on its financial condition and results of operations.
Any Penalty or demand raised by statutory authorities in future will affect financial position of the Company.
The company cannot assure you that its will be able to successfully execute the company's growth strategies, which could affect its business prospects, results of operations and financial condition.
The company cannot assure you that its will be able to secure adequate financing in the future on acceptable terms. Its failures to obtain sufficient financing could result in delay or abandonment of its business plans and this may have an adverse effect on the company's growth and operations.
Insurance coverage may not adequately protect it against all losses due to mishaps or accidents including damage or loss to life and property or the insurance cover may not be available for all the losses as per the insurance policy, which could adversely affect business, results of operations and financial condition.
Its Promoters and Promoter Group will continue to retain significant control in the Company after the Offer which will allow them to influence the outcome of matters submitted to shareholders for approval. Such a concentration of ownership may also have the effect of delaying, preventing or deterring a change in control.
Its ability to pay dividends or issue equity shares by way of bonus in the future will depends upon future earnings, financial condition, cash flows, working capital requirements and capital expenditures.
The Company will not receive any proceeds from the Offer for Sale by the Promoter Selling Shareholder.
Its employees may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and the same may results into imposition of criminal penalties, fines, revocation of regulatory approvals and harm to its reputation, any of which could form a material adverse effect on its business.
If the company is unable to establish and maintain an effective internal controls and compliance system, its business and reputation could be adversely affected.
The company is exposed to the risks of malfunctions or disruptions of information technology systems.
Its funding requirements and proposed deployment of the Proceeds from the Fresh Issue are based on management estimates and may be subject to change based on various factors, some of which are beyond its control.
Destruction, theft, breakdowns of its major plants or equipment or failures to repair or maintain the same may adversely affect its business, cash flows, financial condition and results of operations.
There are entities in India using the name "Enviro" that are unrelated to the Company. Any failures to differentiate between the Company and other unrelated entities by third parties may have an adverse effect on its business.
Its Promoters, certain of the company Directors hold Equity Shares in the Company and are therefore interested in the Company's performance other than remuneration and reimbursement of expenses.
Its Promoters and Promoter Group Members have provided guarantees for loans availed by it, and in the event the same is enforced against them, it could adversely affect its Promoters' ability to manage the affairs of the Company.
Lack of water and infrastructure management poses significant restraints on the growth of the water and wastewater treatment market.
High installation, equipment, and operations costs significantly restrain the growth of the water and wastewater treatment market.
Groundwater depletion and untreated water discharge present significant challenges for the growth of the water and wastewater treatment market, reflecting critical environmental and economic concern.
The growth of water and wastewater treatment is hindered by lack of required techno-commercial awareness in the water and wastewater treatment industry.
The company is subject to certain challenges and risks under the HAM projects.
The company is subject to certain challenges and risks under EPC projects.

Enviro Infra Engineers Ltd Peer Comparison

Understand the company’s industry standing

Enviro Infra Engineers Ltd

EMS Ltd

Ion Exchange (India) Ltd

Face Value

Standalone / Consolidated

Consolidated

Total Income Rs. Cr.

738

809.07

2391.73

EPS-Basis

8.13

29.38

16.53

EPS-Diluted

8.13

29.38

16.53

NAV Per Share

21.48

143.73

69.4

P/E-Basic EPS

---

25.92

38.68

P/E-Diluted EPS

---

RONW(%)

37.83

19.09

19.23

Latest NAV Period

---

Latest NAV

---

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Open link to the registrar using this URL (https://evault.kfintech.com/ipostatus/).

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The IPO opens on 22 Nov 2024 & closes on 26 Nov 2024.

Enviro Infra Engineers Ltd IPO will close on 26 Nov 2024.

In house designing, engineering and execution team 180 engineers.
Increasing presence in existing geographies such as Gujarat, Rajasthan, Punjab, Karnataka, Haryana, Uttar Pradesh, Madhya Pradesh and Chhattisgarh with new projects.
Diversified Order Book of 21 projects across India for an aggregate value of Rs.1,90,628.06 lakhs as of June 30, 2024 across India.
In-house execution capabilities with timely delivery and established track record enabling consistent increase in eligibility for high value project tenders
Use of advanced technologies in the construction and installation of WWTPs and WSSPs.
Experienced Promoters and senior management team.
Consistent financial performance.

S.No	Promoters Name	Pre Issue Shares	Pre Issue Percentage	Post Issue Shares	Post Issue Percentage
1	Sanjay Jain	50925000	37.24	48791000	27.8
2	Manish Jain	50925000	37.21	48791000	27.8
3	Ritu Jain	13124000	9.59	12624000	7.19
4	Sachi Jain	13124000	9.59	12624000	7.19
5	Piyush Jain	75000	0.05	75000	0.05
6	Abhigya Jain	500	---	500	---
7	Sanjay Jain HUF	500	---	500	---
8	Manish Jain UHF	500	---	500	---
9	R K Jain HUF	500	---	500	---

The company bid for Water and Wastewater Treatment Plants (WWTPs) & Water Supply Scheme Projects (WSSPs) funded by the Central and State Governments and derives the company revenues from the contracts awarded to it. Any reduction in budgetary allocation to this sector may affect the number of projects that the government authorities /bodies may plan to develop in a particular period. Its business is directly and significantly dependent on projects awarded by them.
Its projects are awarded through the competitive bidding process by government authorities/bodies. The company may not be able to qualify for, compete and win future projects, which could adversely affect its business and results of operations.
The company relies on its in-house designing, engineering and construction teams for project execution. Loss of employee(s) may have an adverse effect on the execution of its projects.
Its business is working capital intensive. If the company experience insufficient cash flows to meet required payments on its working capital requirements, there may be an adverse effect on the results of its operations.
Its Order Book shall mean estimated contract value of the unexecuted portion of the company existing assigned EPC/ HAM contracts and is an indicator of visibility of its future revenue and it may not be representative of the company future results and its actual income may be significantly less than the estimates reflected in the company Order Book, which could adversely affect its results of operations.
Failures to capitalize on government policy initiatives in the water and wastewater treatment market.
The company relies on various third parties in the civil construction activities for installing its Water and Wastewater Treatment Plants (WWTPs) & Water Supply Scheme Projects (WSSPs) and factors affecting the performance of their obligations could adversely affect the company projects.
The company relies on joint venture partners for selective government projects bids and execution of awarded projects. As on June 30, 2024, the company has developed 9 WWTPs and WSSPs across India in past seven (7) years through its Joint Ventures aggregating to Rs.33,373.00 lakhs. Further, its Water and Wastewater Treatment Plants (WWTPs) projects and Water Supply Scheme Projects (WSSPs) projects to be developed through the company joint ventures comprises of 66,454.15 lakhs constituting 34.86% of its Order Book as of June 30, 2024. The failures of a joint venture partner to perform its obligations could impose additional financial and performance obligations resulting in reduced profits or, in some cases, significant losses from the joint venture and may have an adverse effect on its business, results of operations and financial condition. In the event that a claim, arbitration award or judgement is awarded against the consortium, its may be responsible for the entire claim.
The company has diversified its offerings with "Waste to Energy" additions like Solar Power Plants and Compressed Bio Gas (CBG) forming a part of projects. The company may fails in implementing these initiatives successfully which may affect its future growth and prospects.
The company has experienced negative cash flows in the past and may continue to do so in the future and the same may adversely affect its cash flow requirements, which in turn may adversely affect its ability to operate the company's business and implement its growth plans, thereby affecting the company financial condition.
Increase in the prices of construction materials and labour & works contract charges could have an adverse effect on its business, results of operations and financial condition.
Its actual cost in executing Water and Wastewater Treatment Plants (WWTPs) & Water Supply Scheme Projects (WSSPs) may vary substantially from the assumptions underlying our bid or estimates. The company may be unable to recover all or some of the additional costs and expenses, which may have a material adverse effect on its results of operations, cash flows and financial condition.
The company deploy advanced technologies in the designing and installation of Water and Wastewater Treatment Plants (WWTPs) & Water Supply Scheme Projects (WSSPs). Any incapability to adopt a new technology or change in the requirement of a particular technology by the government authorities may affect its position to bid for Water and Wastewater Treatment Plants (WWTPs) & Water Supply Scheme Projects (WSSPs).
The company has certain contingent liabilities that have not been provided for in its restated consolidated financial statements, which if realised, could adversely affect the company financial condition.
An inability to comply with repayment and other covenants in the financing agreements or otherwise meet its debt servicing obligations could adversely affect the company's business, financial condition, cash flows and credit rating. Further, the company is subject to risks arising from interest rate fluctuations, which could reduce the profitability of its projects and adversely affect its business, financial condition and results of operations.
If the company fails to undertake Operation and Maintenance (O&M) works or if there is any deficiency of service regarding these works in the projects installed by it pursuant to and as per the relevant contractual requirements, its may be subject to penalties or even termination of the company contracts, which may have a material adverse effect on its reputation, business, financial condition, results of operations and cash flows.
Its may not be able to realise the amounts reflected in the company Order Book which may materially and adversely affect its business, prospects, reputation, profitability, financial condition and results of operation.
Its business is substantially dependent on the company design and engineering teams to accurately carry out the prebidding engineering studies for potential projects. Any deviation during the execution of the project as compared to its pre-bid estimates could have a material adverse effect on its cashflows, results of operations and financial condition.
Its business transactions are with government or government funded entities in India, which may expose it to risk, including additional regulatory scrutiny.
Water treatment or reuse and zero liquid discharge technology is subject to rapid change. These changes may affect the demand for its services. If the company is unable to keep abreast of the technological changes and new introductions its business, results of operations and financial condition may be adversely affected.
Its may be subject to liability claims or claims for damages or termination of contracts for failures to meet project completion timelines or defective work, which may adversely impact its profitability, cash flows, results of operations and reputation. However, there has been no instances of liability claims or claims for damages or termination of contracts due to failures to meet project completion timelines or defective work in the past except for claim of liquidated damages by Hindustan Zinc Limited due to delay in completion of 5 & 10 MLD STP at Udaipur due to reasons not attributable to the Company.
One of the Objects of the Offer is funding inorganic growth through unidentified acquisition and general corporate purposes. Its may utilize a portion of the Proceeds from the Fresh Issue to undertake inorganic growth for which the target may not be identified. The company has not made any strategic acquisitions in the past and inability to finalize such activities in a timely manner may delay its deployment of the Proceeds from the Fresh Issue and adversely affect its business and future growth.
Its business is exposed to various implementation risk and other uncertainties which may adversely affect the company's business, results of operations and financial condition.
The company has projects in diverse geographical regions which may expose it to various challenges.
Failures to increase the size of its projects and pre-qualification may affect the company growth prospects.
The company is required to furnish bank guarantees as part of its business. The company inability to arrange such guarantees or the invocation of such guarantees may adversely affect its cash flows and financial condition. As of June 30, 2024, the company had issued bank guarantees (including letter of credit) amounting to Rs. 25,700.32 lakhs towards securing its financial/ performance obligations under the company ongoing projects.
Any adverse revision to its credit rating by rating agencies may adversely affect the company ability to raise additional financing and the interest rates and other commercial terms at which such funding is available.
Its contracts with government authorities/bodies usually contain terms that favour them, who may terminate its contracts prematurely under various circumstances beyond its control and as such, the company has limited ability to negotiate terms of these contracts and may have to accept restrictive or onerous provisions. Its inability to negotiate terms that are favourable to it may have a material adverse impact on its financial condition and results of operations.
The company is dependent upon the experience and skill of its management team and a number of Key Managerial Personnel (KMP) and Senior Management Personnel (SMP). If the company is unable to attract or retain such qualified personnel, this could adversely affect its business, results of operations and financial condition.
Its failures to accurately forecast and manage inventory could result in an unexpected shortfall and/ or surplus of raw materials, equipment and manpower, which could affect its business and financial condition.
Unsecured loans of Rs. 4,918.38 lakhs taken by it can be recalled at any time.
The company is dependent on the recurring revenue from its operating and maintenance contracts, which is in almost all cases an inherent part of its EPC and HAM project contract. Cancellations of the company operating and maintenance contracts may adversely affect its business, financial condition, results of operations and prospects.
Any inability to maintain its equipment assets or manage the company employees or inadequate workloads may cause underutilization of its workforce and equipment, and such underutilization could reduce its ability to efficiently utilize its assets which may have an impact on the company profitability.
Any variation in the utilisation of the Proceeds from the Fresh Issue would be subject to certain compliance requirements, including prior shareholders' approval.
Its inability to protect or use intellectual property rights may adversely affect the company's business.
In the event of failures to complete of the projects or delay in execution of the projects, the company may not be able to recognize the revenue from the projects in its books of accounts.
Failures to achieve financial closures and funding arrangements within a stipulated period for Hybrid Annuity Model (HAM) projects may attract penalty and may also lead to termination of the contract.
Its inability to respond adequately to increased competition from organised and unorganised in its business may adversely affect the company's business, financial condition and results of operations.
There are outstanding legal proceedings involving the Company which may adversely affect its business, financial conditions, and results of operations.
If the company is unable to meet technical and financial qualification criteria laid down by the government authorities while submitting the bids for the project whether independently or together with other joint venture partners, its may not be able to qualify for, compete and win future projects which in turn will affect its growth prospects.
Industry information included in this Red Herring Prospectus has been derived from an industry report issued by Marketysers Global Consulting LLP dated October 11, 2024 ("Marketysers Report"). There can be no assurance that such third-party statistical, financial and other industry information is complete, reliable or accurate.
The Company has in the past entered into related party transactions with its Directors, Promoters and Promoter Group members/ entities, Subsidiaries, Group Company and joint ventures and may continue to do so in the future. There can be no assurance that such transactions, individually or in the aggregate, will not have an adverse effect on its financial condition and results of operations.
Any Penalty or demand raised by statutory authorities in future will affect financial position of the Company.
The company cannot assure you that its will be able to successfully execute the company's growth strategies, which could affect its business prospects, results of operations and financial condition.
The company cannot assure you that its will be able to secure adequate financing in the future on acceptable terms. Its failures to obtain sufficient financing could result in delay or abandonment of its business plans and this may have an adverse effect on the company's growth and operations.
Insurance coverage may not adequately protect it against all losses due to mishaps or accidents including damage or loss to life and property or the insurance cover may not be available for all the losses as per the insurance policy, which could adversely affect business, results of operations and financial condition.
Its Promoters and Promoter Group will continue to retain significant control in the Company after the Offer which will allow them to influence the outcome of matters submitted to shareholders for approval. Such a concentration of ownership may also have the effect of delaying, preventing or deterring a change in control.
Its ability to pay dividends or issue equity shares by way of bonus in the future will depends upon future earnings, financial condition, cash flows, working capital requirements and capital expenditures.
The Company will not receive any proceeds from the Offer for Sale by the Promoter Selling Shareholder.
Its employees may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and the same may results into imposition of criminal penalties, fines, revocation of regulatory approvals and harm to its reputation, any of which could form a material adverse effect on its business.
If the company is unable to establish and maintain an effective internal controls and compliance system, its business and reputation could be adversely affected.
The company is exposed to the risks of malfunctions or disruptions of information technology systems.
Its funding requirements and proposed deployment of the Proceeds from the Fresh Issue are based on management estimates and may be subject to change based on various factors, some of which are beyond its control.
Destruction, theft, breakdowns of its major plants or equipment or failures to repair or maintain the same may adversely affect its business, cash flows, financial condition and results of operations.
There are entities in India using the name "Enviro" that are unrelated to the Company. Any failures to differentiate between the Company and other unrelated entities by third parties may have an adverse effect on its business.
Its Promoters, certain of the company Directors hold Equity Shares in the Company and are therefore interested in the Company's performance other than remuneration and reimbursement of expenses.
Its Promoters and Promoter Group Members have provided guarantees for loans availed by it, and in the event the same is enforced against them, it could adversely affect its Promoters' ability to manage the affairs of the Company.
Lack of water and infrastructure management poses significant restraints on the growth of the water and wastewater treatment market.
High installation, equipment, and operations costs significantly restrain the growth of the water and wastewater treatment market.
Groundwater depletion and untreated water discharge present significant challenges for the growth of the water and wastewater treatment market, reflecting critical environmental and economic concern.
The growth of water and wastewater treatment is hindered by lack of required techno-commercial awareness in the water and wastewater treatment industry.
The company is subject to certain challenges and risks under the HAM projects.
The company is subject to certain challenges and risks under EPC projects.

The Issue type of Enviro Infra Engineers Ltd is Book Building.

The minimum application for shares of Enviro Infra Engineers Ltd is 101.

The total shares issue of Enviro Infra Engineers Ltd is 43948000.

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