After a delay in launching its IPO, India’s energy efficiency flag bearer Energy Efficiency Services Ltd (EESL) is now contemplating listing on domestic bourses by the end of the current or the start of next fiscal year. EESL IPO is likely to value the company at INR5,000 crore (INR50 billion), said a report by IANS.
“Company still has plans of getting listed but because of the current scenario (Covid-19) and the impact it has had on the market, we will revisit this once the situation normalises,” said EESL’s managing director Saurabh Kumar.
“It can happen at the end of this financial year or in the beginning of the next (fiscal). But the plan is certainly on the table. The valuation of the IPO is still pegged at INR5,000 crore.”
Promoted by PSUs
EESL is promoted by the Ministry of Power as a joint venture between four public sector undertakings (PSUs) NTPC, PFC, REC and PowerGrid and has a net worth of over INR8,300 crore as per audited financial results for the year ended 31 March 2019.
EESL promotes energy efficient technologies and is the nodal agency for the procurement of electric vehicles under the government’s faster adoption and manufacturing of electric vehicles in India (FAME) scheme.
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EESL IPO: Steady progress in financial performance
Prior to its IPO, EESL has made steady progress towards achieving its objectives and this reflects in its top line. For the year ended 31 March 2019, the company posted revenues of INR1,837.65 crore, registering a growth of 35.5% from a year ago. Net profit during the same period jumped from INR39.5 crore to INR95.1 crore.
Its latest performance for the six months ended 30 September 2019 is also impressive, although slower. With 6.5% growth in revenues to INR742.1 crore, the company posted multi-fold increase in net income to INR32.3 crore.
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Quite clearly, half-yearly results are in contrast to prior growth rates as well as own projections. Earlier in October 2019, Kumar had said that EESL was expected to post a profit of around INR200 crore for the full year FY2020 on a top line of INR4,000 crore. With economic activity coming to a grinding halt due to coronavirus, these figures now look unrealistic.
While the procurement of electric vehicles has been cut down drastically due to poor demand, the company expects smart meters to drive growth going forward. EESL is working with distribution companies in various states and plans to eventually replace 25 crore conventional meters with smart meters across India.
