Effwa Infra and Research IPO Overview

Effwa Infra and Research Limited is engaged in EPC, and project management works related to water pollution and sewage related services.
Effwa Infra and Research IPO envisages to garner Rs 51.27 crores. The issue is a combination of fresh issue aggregating to Rs 43.60 crores and offer for sale of Rs 7.68 crores.

IPO opensJuly 05, 2024
IPO ClosesJuly 09, 2024
IPO Size (Rs.)₹51.27 Cr
IPO Size (shares)6,252,800 shares
BreakupFresh issue 43.60 Cr + OFS ₹7.68 Cr
Face Value:₹ 10
IPO Price in Rs :₹78 to ₹82 per share
Minimum Lot1600 Shares
Listing AtNSE SME
QIB ~50 %
NII Quota~15%
Retail Quota~35%
 Lead ManagerShreni Shares Limited
RegistrarBigshare
Market makerRikhav Securities

About Effwa Infra and Research :

  • Incorporated in the year 2011, at Thane, (Maharashtra)
  • “Effwa Infra & Research Limited”, (“EIRL”) is engaged in the business of engineering, consultancy, procurement, construction and integrated project management services in water pollution control, encompassing sewage and industrial effluent treatment, solid waste treatment and disposal, ventilation systems, hazardous waste management, and water treatment plants.
  • They also function as consultants and advisors, providing a range of services encompassing project organization, management, equipment procurement, funding, and project execution.
  • Their expertise spans the entire project lifecycle, from registration and design to implementation, supervision, and finalizing contract terms.
  • Dr. Varsha Subhash Kamal and Mr. Subhash Ramavtar Kamal are the company’s promoters.

Financials: Effwa Infra and Research IPO

Particulars/  Rs. Lacs2023-242022-232021-22
Total Revenue14,551.4611,541.3610,461.67
Profit after Tax1,380.06513.04459.99
Share Capital1,783.04232.57232.57
Net worth3,715.052,355.891,842.85
Net Asset Value20.8413.2110.34
Total borrowings1,406.441,623.011,026.11
Post issue Share Capital2315  
FV10.0  
IPO price82.0  
EPS Fy232.2  
PE Fy2337.0  
EPS Fy246.0  
PE Fy24 13.8  
Market cap in Lacs18,983  
Market cap / Sales1.30  

Anchors: Effwa Infra and Research IPO

Effwa Infra and Research IPO: Salient Points

  • The company has done over 45 water management infrastructure projects as on March 31, 2024.
  • The major portion of revenue for the financial year ended March 31, 2024, March 31, 2023 and March 31, 2022 is from Government Institutions i.e., 46.57% and 43.02% and 52.28%. But they have clients across other segments as well.
  • Net proceeds use:
Sr. NoParticularsAmount
1.Funding working capital requirements of our company3,300.00
2.Funding of capital expenditure requirements of our Company towards purchase of new office Equipments41.00
3.General Corporate Purposes#[●]
  • They generate major portion of sales from operations in certain geographical regions both Domestic and Export (Including Special Economic Zone).
  ParticularsFor the year ended
March 31, 2024March 31, 2023March 31, 2022
ValueIn %ValueIn %ValueIn %
India (Domestic)
Andhra Pradesh430.993.991,408.2213.26123.441.23
Chhattisgarh0.220.00491.604.63508.315.08
Gujarat924.328.553,332.5931.383425.7534.23
Madhya Pradesh3.960.043.540.04
Maharashtra3,102.4628.711,970.2118.551822.9218.22
Odisha1,427.1413.213,385.7531.883602.9336.00
West Bengal4,920.9045.5427.690.26520.175.20
Rajasthan
Exports
Special Economic Zone3,709.8925.5649.350.43
Tanzania—-840.217.30429.624.12
Total14,515.93100.0011,509.57100.0010,436.68100.00
  • Peers
Company/ FY24 figuresCMP Rs.Revenue Rs. CrNet Profit Rs. CrNPM (%)PEMacp/salesRoNW(%)
Effwa Infra & Research82145.5013.89.5%13.81.345.46
VA Tech Wabag1,3162,856250.008.8%33.32.8717.1
EMS Limited67779315319.3%24.64.7323.72
  • They derive significant portion of revenue from one of their services, Effluent Treatment Plant, which contributed 83.11%, 61.93% and 86.92% of revenue from operations for the financial year ended March 31, 2024, 2023 and 2022, respectively.
  • As of May 31, 2024, Order Book was ₹ 526 crore.
  • Effwa Infra and Research IPO is coming at a PE ratio of 13.8x (FY24 Earnings). Areas in which company operates i.e Infrastructure for the water management   including the management of Effluent Treatment Plants (ETP), Sewage Treatment and Remediation (STP), Water Treatment and Distribution (WTP) and Hazardous Waste Management etc., hold good prospects.
  • I intend to apply in Effwa Infra and Research IPO subject to availability of funds.
  • GMP as reported on social media has been Rs. 110 (135%)
  • The lead manager has a good track record.
  • SME IPOs are quite volatile and new retail investors need to exercise considerable caution in my view.
  • This post is exploratory and educational purposes only. Please do your own diligence before investing in SME IPOs like this.
  • Standard disclaimer: I am not a SEBI registered analyst and above analysis is for educational purpose only. Iam a postgraduate in engineering & Management . I have in the past cleared some exams like NISM-Series-V-A: Mutual Fund Distributors Certification, NISM-Series-X-A: Investment Adviser (Level 1) Certification and NISM-Series-X-B: Investment Adviser (Level 2) Examination. This post is my view on the subject matter and is only academic and exploratory in nature. It is not meant to influence investment decisions of investors. I may have bias/vested interest in covered Stock/Mutual Funds/NCD etc. due to my own investment or leaning. Further my understanding of the areas on which I write may be imperfect or incomplete and data could be wrong due to limited time and resources at my disposal. Do check the data from company’s RHP and exchanges before making any decision. Please do your own due diligence as stock market/MF investments have high degree of inherent risk.

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