Apex Ecotech Limited Announces IPO to Raise ₹25.54 Crores by Issuing 34.99 Lakh Shares

Apex Ecotech Limited, a prominent player in India's water and wastewater management industry, is launching its Initial Public Offering (IPO) to raise ₹25.54 crores through a fresh issue of 34.99 lakh shares. It aims to address the company's working capital needs, meet general corporate purposes, and cover public issue expenses. Apex Ecotech’s solutions in water treatment, wastewater recycling, and zero liquid discharge (ZLD) systems position it strategically within a critical and growing sector.

Let’s get into more detail about the company and the IPO offering.

Company Information

Apex Ecotech Limited (formerly known as Apex Ecotech Private Limited) was established in 2009 by a group of dedicated professionals and has emerged as a leading provider of advanced water and wastewater treatment solutions. They specialize in delivering sustainable, energy-efficient, and eco-friendly systems for effective water resource management. Their extensive range of products, systems, and services is meticulously designed to meet the complex treatment and recycling needs of various industries and other establishments. By focusing on optimal design and innovative solutions, they ensure that their clients achieve both operational efficiency and environmental responsibility. 

IPO Details

• Subscription Dates: The IPO subscription is between November 21 and November 24, 2024.
• Price Band: Price band of the IPO is from ₹102 to ₹108 per share.
• Minimum Bid Lot: 125 shares (₹13,500 to ₹13,900 per lot) is the minimum lot.
• Issue Size: ₹50 crore, consisting of:
• Fresh Issue: Raising funds to finance expansion and working capital requirements.
• Offer for Sale (OFS): Existing stakeholders selling shares to partially monetize their holdings.
• Listing Exchanges: Shares will debut on the Bombay Stock Exchange (BSE) and the National Stock Exchange (NSE).

Objectives of the Issue

The proceeds will be used for:

• Expansion Projects: Establishing new facilities to meet rising demand.
• Working Capital: Supporting day-to-day operations.
• General Corporate Purposes: Strengthening overall financial health and operational capacity.

Financial Performance

• Revenue Growth: The company has reported steady growth in revenues over the past few years, driven by rising demand for eco-friendly solutions. From 349 cr of revenue in FY23, it has clocked revenue of 534.65 Cr in FY24. 
• Profitability: Profit of Apex Ecotech has a high potential for margin improvement with increased scale and efficiency. And it is evident in the increase in profit (PAT) from 35.21 Cr in FY23 to 66.30 Cr in FY24.
• Networth: Good growth in revenue and profits have led to more than doubling of Networth from FY23 (72.25 Cr) to FY24 (147.36 Cr)

Competitive Strengths

• Technological Innovation: The company has very strong R&D capabilities that has resulted in strong sales run-rate in the recent times..
• Diverse Client Base: Their diversified client base Includes industrial giants and government bodies.
• Sustainability Focus: The products of the company aligns with the global push towards eco-friendly and sustainable practices.

Risks and Challenges

• Market Dependency: The success of their business is tied to government policies on environmental regulations.
• Competitive Industry: this industry faces stiff competition from established domestic and international players.
• Economic Slowdowns: Any kind of economic slowdown may impact the demand for large-scale projects.