EMS Limited, a leading entity in India's water and wastewater management industry, made a significant debut on India's domestic stock markets on Thursday. The company's shares opened with a premium of 34% on the National Stock Exchange (NSE) and 33% higher on the Bombay Stock Exchange (BSE), notwithstanding a broader market downturn.
Upon listing, EMS shares soared to a peak of ₹288.8 on the NSE and ₹288.70 on the BSE, marking an increase of up to 36.9%. The company's market capitalisation was recorded at ₹1,517 crore. The shares were initially listed at ₹282.05 on the NSE and ₹281.55 on the BSE, up from their issue price of ₹211.
Founded in 2012 as EMS Infracon, EMS Limited provides comprehensive solutions in the water and wastewater sector, including sewerage and water supply systems, waste treatment plants, among other services. The firm also manages electrical transmission and distribution, road infrastructure, and operation and maintenance of wastewater and water supply scheme projects for government authorities.
The company had a successful initial public offering (IPO) between September 8 and September 12, raising ₹321.24 crore. The IPO comprised a fresh issue of equity shares worth ₹146.24 crore and an offer for sale of shares worth ₹175 crore by existing shareholders. The funds raised from the fresh issue are expected to be used for working capital requirements and general corporate purposes.
The IPO attracted substantial investor interest, with overall subscriptions reaching 76.21 times the issue size. The portion reserved for qualified institutional bidders (QIBs) was oversubscribed by 149.98 times, followed by non-institutional investors category with 84.39 times oversubscription. The retail investors' quota was subscribed 30.55 times.
Investor optimism for EMS is largely attributed to the positive outlook for the water and wastewater industry in India. This is driven by an expanding urban population and the need for efficient city planning and utility services. Moreover, the company is poised to benefit from government initiatives such as the Jal Jeevan Mission, aimed at providing piped water access to every household.
EMS has demonstrated consistent growth over the past three fiscal years, with total revenues of ₹336.18 crore, ₹363.10 crore, and ₹543.28 crore in FY21, FY22, and FY23 respectively. Similarly, net profit showed a steady increase from ₹71.91 crore in FY21 to ₹78.93 crore in FY22, and further to ₹108.67 crore in FY23.
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