Enviro Infra Engineers IPO day 2: GMP jumps; subscription status, review, apply or not?

Enviro Infra Engineers IPO: The initial public offering (IPO) of Enviro Infra Engineers Limited opened on 22nd November and will remain open for bidding until 26th November 2024. This means investors have two days to apply for the Enviro Infra Engineers IPO. According to Enviro Infra Engineers IPO subscription status after day one of bidding, the public issue received a decent response from investors as it was booked over two times its offered shares. Meanwhile, after a trend reversal in the Indian stock market on Friday and a strong response by the Indian primary market investors, Enviro Infra Engineers' share price has risen in the grey market. According to stock market observers, Enviro Infra Engineers Limited shares are trading at a premium of ₹53 in the grey market today.

Enviro Infra Engineers IPO GMP today

As mentioned above, Enviro Infra Engineers IPO GMP (Grey Market Premium) today is ₹53, which is ₹22 higher than Friday's GMP of ₹31. In the last four days, Enviro Infra Engineers IPO GMP has risen from ₹23 to ₹53, which is praiseworthy, said observers. They noted that trend reversal on Dalal Street and decisive response by investors are some of the primary reasons for the rise in the grey market sentiments regarding Enviro Infra Engineers IPO.

Enviro Infra Engineers IPO subscription status

By 3:00 PM on day 2 of bidding, the book build issue had been booked 9.93 times, the retail portion 7.36 times, the NII segment 25.83 times, and the QIB segment 2.48 times.

Enviro Infra Engineers IPO review

On whether Enviro Infra Engineers IPO is good or bad for the primary market investors, Indsec Securities said, "At an upper price band of ₹148, the IPO is valued at an FY24 EV/EBITDA of 16.7x vs an average of 14.6x for their listed peers. Over FY22-24, the company's Revenue/EBITDA/PAT has grown at a CAGR of 115.6%/107.3%/101.1%, respectively. The order bid-to-conversion ratio stands at 39% on average over the last three FYs. The company's growth is tied to the timely rollout of tenders from government schemes about wastewater treatment and water supply. However, in H1FY25, the tendering activity was subdued due to the general election and is expected to pick up in H2FY25. Despite that, their order book position on June 30, 2024, remains strong at ₹19,063mn, offering revenue visibility of over 30 months on an FY24 revenue basis. The project execution timeline for the current order book is 18-30 months. As highlighted above, the issue is valued higher than its listed peers on FY24 EV/EBITDA. This, combined with sluggish tendering activity, limits the upside potential. We assign a "Subscribe for Long term" rating to the IPO."

Swastika Investment has also assigned a 'subscribe' tag to the book build issue, saying, “The company is expanding its footprint with new projects and backed by a strong order book. The balance sheet of the company signals that the company has managed to register robust growth in revenue and profit. Besides, the book build issue is offered at a fair price that offers a reasonable valuation against its peers. So, we recommend investors apply for the public issue, keeping a long-term view.”

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