Envirotech Systems Limited IPO presents a unique investment opportunity for investors, particularly in the field of acoustic solutions. Renowned for their expertise, Envirotech Systems offers an extensive range of noise control solutions across multiple domains, establishing themselves as leaders in the market. The company's products cater to diverse acoustic needs, reflecting their strong industry presence.

The IPO opens on September 13, 2024, and closes on September 18, 2024. This Book Built Issue is aimed at raising ₹30.24 Crores, with a fresh issue of 54.00 Lakh Shares. The price band has been set at ₹53 to ₹56 per equity share. The minimum lot size for retail investors is 2,000 shares, translating to an investment of ₹112,000, while High-Net-Worth Individuals (HNIs) must invest a minimum of 2 lots, amounting to ₹224,000.

Share India Capital Services Private Limited is the book-running lead manager, with BIGSHARE SERVICES PRIVATE LIMITED as the registrar. Share India Securities Limited will act as the sole market maker for the IPO.

Financial Overview:

Envirotech Systems has shown substantial growth in recent years. From FY22 to FY24, their revenue surged from ₹1,849.54 Lakhs to ₹4,687.95 Lakhs, a clear indicator of the company’s expanding market reach. Similarly, their EBITDA grew from ₹196.48 Lakhs in FY22 to ₹1,660.09 Lakhs in FY24, reflecting a notable increase in profitability. The Profit After Tax (PAT) saw a sharp rise from ₹105.73 Lakhs in FY22 to ₹1,142.88 Lakhs in FY24, demonstrating the company’s ability to translate revenue into profit effectively.

Valuation:

Envirotech Systems is offering shares at a pre-issue EPS of ₹8.54 and a post-issue EPS of ₹6.08. The pre-issue P/E ratio is 6.55x, while the post-issue P/E ratio stands at 9.21x, which, when compared to industry peers, positions the IPO as fairly priced. Furthermore, the company boasts a Return on Capital Employed (ROCE) of 62.43% and a Return on Equity (ROE) of 58.29% for FY24, underlining its operational efficiency.

Grey Market Premium (GMP):

The Grey Market Premium (GMP) for Envirotech Systems is projected to be between ₹20 to ₹25, indicating a potential listing gain of 40-45%. While GMP is a speculative indicator, it offers insight into the market sentiment around the IPO. However, investors are advised not to rely solely on GMP when making investment decisions, as it operates in an unregulated market.

Live Subscription Status:

As of 08:27 PM on 13 September 2024, the Envirotech Systems Limited IPO has been subscribed 2.13 times on the first day of the subscription period. Investors can monitor the live subscription status throughout the IPO period to stay updated on demand dynamics.

Anchor Investors:

Envirotech Systems has successfully raised ₹7.87 Crores from Anchor Investors at a price of ₹56 per share, with a total allocation of 1,406,000 equity shares. This early interest from institutional investors further strengthens confidence in the company's prospects.

Objectives of the IPO:

The proceeds from the Envirotech Systems IPO will be utilized for the following:

₹1,200 Lakhs towards purchasing land and building for setting up a factory.

₹800 Lakhs for working capital requirements.

Allocation towards general corporate expenses and issue expenses.

How to Check Allotment Status:

Investors can check the Envirotech Systems IPO allotment status starting September 19, 2024:

Visit the Registrar’s website (BIGSHARE SERVICES PRIVATE LIMITED).

Select Envirotech Systems Limited IPO from the dropdown list.

Enter your application number, PAN, or DP Client ID.

Submit the details to view your allotment status.

Investment Recommendation:

Based on the company's robust financial performance, attractive valuation, and strong GMP, Envirotech Systems Limited IPO is recommended for both listing gains and long-term investment. The company’s expertise in acoustic solutions, coupled with its financial growth, positions it as a solid player in the market, making this IPO a compelling opportunity for investors looking to diversify their portfolio.

Disclaimer:

This IPO review is for educational purposes and should not be considered financial advice. Please consult a financial advisor before making any investment decisions.

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