Globally, water usage has been increasing at a rate of 1% per year over the last four decades. In India, fresh water availability per capita is projected to decline by 15% by 2025. With limited freshwater resources, recycling and efficient water use have become critical. Addressing this challenge, Enviro Infra Engineers, a company specializing in wastewater treatment, is launching its IPO to raise ₹650.43 crore.

What Do Enviro Infra Engineers Do?

Enviro Infra Engineers focuses on designing, constructing, operating, and maintaining:

  • WWTPs: Sewage Treatment Plants (STPs), Sewerage Schemes (SS), and Common Effluent Treatment Plants (CETPs)
  • WSSPs: Water Treatment Plants (WTPs), Pumping Stations, and water supply pipelines

The company bids for government tenders on an EPC or HAM basis.

Key Highlights of the Company

As of June 30 2024, the company has: 

  • developed 28 WWTPs and WSSPs in 7 years (22 projects >10 MLD capacity)
current order book: ₹1,906.28 crore (21 ongoing projects across 8 states)


Enviro Infra Engineers IPO Details

The IPO, open from November 22 to November 26, 2024, comprises:

  • Fresh Issue: ₹572.46 crore
  • Offer for Sale: ₹77.97 crore

Funds raised will be used for:

  1. Working capital needs
  2. Investments in a 60 MLD STP project in Mathura under PPP mode
  3. Loan repayment/prepayment
  4. Inorganic growth opportunities
  5. General corporate purposes

Business Landscape & Need for Wastewater Treatment

India, home to 17% of the global population but only 4% of global freshwater resources, is among the world’s most water-stressed nations. In 2021, per capita water availability was 1,486 cubic meters, already in the water-stressed category. By 2050, this could drop to 1,140 cubic meters.

With water demand projected to grow by 30%, the need for innovative solutions like wastewater treatment plants is evident. India’s rapid urbanization further increases the demand for sewage treatment, with estimates suggesting a requirement of over 4,500 sewage treatment plants nationwide.

Globally, the water and wastewater treatment market, valued at $306.33 billion in 2024, is expected to grow at a CAGR of 6.1%, reaching $521.97 billion by 2033.

Financial Growth of Enviro Infra

  • FY24 revenue grew by 116% to ₹738 crore (from ₹341 crore in FY23)
  • PAT increased by 101% to ₹110.54 crore (from ₹54.98 crore in FY23)
  • Revenue and PAT have grown at 81% and 79% CAGR respectively over the past two years
Period Ended31 Mar 202431 Mar 202331 Mar 2022
Revenue738341.66225.62
Profit After Tax110.5454.9834.55

Enviro Infra Engineers: Strong Margins but High Debt Ratio in a Competitive Industry

Despite being the smallest player by revenue, Enviro Infra Engineers boasts the second-best margins in the industry:

  • EBITDA Margin: 23.23% (compared to EMS Ltd’s 25.7%)
  • PAT Margin: 15.17% (compared to EMS Ltd’s 19.21%)

However, the company has the highest debt ratio (0.8) among peers.

Key  Strengths Enviro Infra 

  • Expert Team: In-house design, engineering, and execution capabilities.
  • Expanding Reach: Growing presence with diverse projects across India.
  • Robust Order Book: Diversified and high-value project pipeline.
  • On-Time Delivery: Proven track record in executing projects with advanced technologies.
  • Experienced Leadership: Skilled promoters and senior management team.
  • Financial Consistency: Strong and steady financial performance.

Risks & Challenges of Enviro Infra

  • Dependence on Government Funding: Any reduction in allocations to the water and wastewater sector could adversely impact revenues.
  • Working Capital Intensity: The sector requires significant working capital, and inadequate cash flow could disrupt operations.
  • Contingent Liabilities: As of Q1 FY25, liabilities worth ₹258.83 crore could potentially strain financials if converted.

The Bigger Picture

Enviro Infra Engineers is at the forefront of tackling one of India’s most pressing challenges—water scarcity. Its proven expertise in water and wastewater treatment projects positions it to benefit from increasing demand driven by urbanization and industrial growth. However, risks tied to government dependency and financial pressures underline the importance of cautious optimism.