Aarvee Engineering Consultants IPO

Strengths · 7

• 01Revenue from operations rose from Rs 438.14 crore in FY2023 to Rs 517.00 crore in FY2024 and Rs 567.13 crore in FY2025.
• 02Profit after tax grew from Rs 18.08 crore in FY2023 to Rs 51.60 crore in FY2025.
• 03Order book stood at Rs 2,274.87 crore on 30 June 2025, up from Rs 1,763.00 crore on 31 March 2025, mainly on large railway orders.
• 04Client concentration is falling: the top 10 clients gave 57.40% of revenue in FY2025 against 77.31% in FY2023.
• 05Return on net worth was 24.08% in FY2025 and 24.17% in FY2024.
• 06Debt to equity was 0.24 times in FY2025, and net worth was Rs 238.38 crore.
• 07Engineers make up 2,623 of 3,505 employees (74.83%) as on 30 June 2025, and the company has worked in 20 countries.

Risks · 10

• 01Government and government related clients gave 96.13% of revenue from operations in FY2025, so one policy or payment problem can hit most of the business.
• 02Top 5 clients gave 43.81% of revenue in FY2025 and the top 10 gave 57.40%.
• 03Railways and metro rail gave 48.22% of revenue in FY2025, so the company depends heavily on one sector.
• 04Net cash from operating activities was negative Rs 5.31 crore in FY2025 although profit after tax was Rs 51.60 crore, as receivables rose.
• 05Guarantees outstanding were Rs 167.02 crore on 31 March 2025, and clients can invoke performance guarantees or levy liquidated damages.
• 06Outstanding borrowings were Rs 279.67 crore on 31 July 2025, and Rs 76.00 crore of the fresh issue goes to repay part of them.
• 07Overseas projects gave 12.50% of FY2025 revenue and carry country and currency risks.
• 08Promoter Venkatachala Chakrapani Redla is selling up to 67,50,000 shares in the offer for sale, and his weighted average cost of acquisition is Rs 0.26 per share.
• 09Six tax proceedings against the company involve Rs 1.54 crore, and a disputed GST input tax credit of Rs 6.73 crore is a contingent liability.
• 10General corporate purposes has no stated amount yet, and the document caps it at 25% of the gross proceeds.

Aarvee Engineering Consultants Limited is an infrastructure consultancy company headquartered in Hyderabad. It provides design and supervision services across the project life cycle. These include feasibility studies, detailed project reports, pre-bid services, detailed design, project management consultancy, supervision of operations and maintenance, third party inspection and lenders engineering services. As on 30 June 2025 it had undertaken over 2,750 projects in 20 countries across Asia, Africa, Australia and Europe. This count includes projects of a proprietorship firm the company acquired in 2007.

The company was incorporated in 2005 as Aarvee Associates Architects Engineers & Consultants Private Limited. It became a public company in 2025. Its work covers railways and metro rail, roads and bridges, environment, water supply and sanitation, and water resources and irrigation. Railways and metro rail gave 48.22% of revenue from operations in FY2025. Its clients are mostly government and government related bodies, which gave 96.13% of revenue in FY2025.

The company is a people business. It had 3,505 permanent employees on 30 June 2025, of whom 2,623 were engineers. Employee benefit expense was Rs 276.04 crore in FY2025, the largest cost line. Its order book, the value of work still to be completed under existing contracts, was Rs 2,274.87 crore on 30 June 2025. It was Rs 1,430.87 crore on 31 March 2023.

Overseas projects gave 12.50% of revenue in FY2025, up from 5.98% in FY2023. The company has two overseas subsidiaries, one in Australia set up in 2011 and one in the UK set up in 2022. It also has three subsidiaries in India. One of them, SRA OSS India Private Limited, builds software for design automation and project monitoring dashboards.

The industry

According to the ICRA report quoted in the document, India's infrastructure consulting market was valued at Rs 740.10 billion in Fiscal 2021. It grew to Rs 1,464.64 billion in Fiscal 2025 and is projected to reach Rs 2,935.09 billion in Fiscal 2030. The market covers project management consultancy, feasibility studies, detailed project reports, design and engineering services and master planning.

Customer concentration: Top 5 clients gave 43.81% of revenue from operations in FY2025 (52.97% in FY2024), and the top 10 gave 57.40% (67.98% in FY2024).