Engineers India Limited is one of the leading PSU under Ministry of Petroleum and Natural Gas which operates into two major segments, Consultancy & Engineering Projects, and Turnkey Projects and diversified business portfolio from various sectors of Petroleum Refining, Onshore Oil & Gas, Offshore Oil & Gas, Pipelines, Strategic Storages, Petrochemicals, Ports & Terminals, Fertilizers, Mining & Metallurgy, Infrastructure, Water & Waste Management, Bio Fuel and Green Hydrogen. It is one of the leading engineering consultancy companies providing design, engineering, procurement, construction, and integrated project management services, focused on the oil and gas and petrochemicals industries in India and internationally. The company also provides specialist services such as heat and mass transfer equipment design, environmental engineering services, specialist materials and maintenance services, energy conservation services, plant operation and safety services. It also a primary provider of engineering consultancy services for the GoI's energy security initiative under its Integrated Energy Policy for strategic crude storages. Company has its corporate office in New Delhi and Gurugram, branch office in Mumbai, three regional engineering offices in Kolkata, Chennai & Vadodara and has inspection offices at all major manufacturing locations of the country. Company’s R&D division pursues technology development both in-house and in collaboration with other organizations like IOCL-R&D, BPCL-R&D, IIP, CHT, HPCL, CPCL, NRL etc. Its overseas presence is marked by an engineering office in Abu Dhabi, which caters to the business needs in UAE/Middle-East region along with its offices in London, Milan and Shanghai to coordinate the activities of international procurement and marketing. Most of the major oil & gas companies in these regions like Sonatrach, GASCO, ADCO, ZADCO, KNPC, BAPCO, BANAGAS etc. have utilized EIL’s services for their prestigious projects.

EIL has a wholly owned subsidiary, Certification Engineers International Limited (CEIL), which provides services in the field of certification, re-certification, third party inspection services. It has also entered into a Joint Venture viz, Ramagundam Fertilizers and Chemicals Limited (RFCL) with National Fertilizers Limited (NFL) and Fertilizer Corporation of India (FCIL) for revival of Ramagundam Fertilizer Plant. Considering some major achievements of the company currently 20 out of 23 Refineries in India have EIL Footprints and it has Installed 10 out of the 11 mega petrochemical complexes in India. Company has built a combined refining capacity of more than 150 MMTPA (3 million BPD) in India and recently forayed into Underground Caverns for Storages.

Company has an impressive record of executing over 7000 assignments consisting of 400 major projects valued over US$200 Billion. Its project portfolio consists of 91 Major refinery projects, 12 major petrochemical projects, 45 Oil and Gas processing projects, 213 offshore platforms, 51 pipeline projects, 33 Mining and metallurgy projects, 12 fertilizer projects, 14 Ports and Storage terminals, 40 infrastructure projects and 24 turnkey projects. It has developed more than 35 process technologies and its portfolio includes various technologies for petroleum refining, oil and gas processing and aromatics. The DHDT Technology developed by EIL and IOCL-R&D has been implemented for the first time in the country at IOCL’s Bongaigaon Refinery. EIL currently holds 36 live patents and has 31 pending patent applications relating to various process technologies. EIL has already embarked upon a new journey with a vision of 5K25 i.e to be a Rs 5,000 Crore Turnover company by 2025.

Clientele:

Fundamentals (FY22-23):

Financial Results:

Company’s Net Sales was Rs 789.81 crore in September 2023 down by 0.41%, Quarterly Net Profit at Rs. 127.46 crore in September 2023 up by 69.58% and EBITDA stands at Rs. 142.33 crore in September 2023 up by 29.4% as compared to September 2022. Company’s EPS has increased to Rs. 2.27 in September 2023 from Rs. 1.34 in September 2022.

Business Secured and Order Book:

As on Q2FY24 company’s secured business is at Rs. 11,442 Mn which is 3 times higher than the secured business in same period in previous year. In consultancy services company secured 57% business Domestically and 43% internationally.

Company’s total order book position stands at Rs. 81,883 Mn out of which its Consultancy services comprises of 59% of total order book position and remaining 41% comprises of Turnkey projects.

Capital Investments as on Q2 Fy23-24:

Key Updates:

1. EIL has bagged the prestigious and one of its kind Assam Bio Refinery Project, being executed at Numaligarh with bamboo as a feedstock. This Bio Refinery at Numaligarh will be the largest among 12 such refineries proposed to be set up across India.
2. Company has also bagged Sagarmala project of GoI which is offering huge opportunities for the company and its is preparing itself for strategic entry in to the sectors of Ports, Harbours and Jetties.
3. EIL has also made a significant headway in Mongloia by signing a contract with Mongol Refinery State Owned LLC for its upcoming greenfield Refinery.
4. EIL is providing consultancy services for the milestone project of India’s first long-distance Hydrogen Pipeline and one of the company’s key projects also include Conceptual Study for Setting up Green Hydrogen Plant based on 5000 MW renewable power and Hydrogen blending in NGs Pipeline/ City Gas Distribution Network.
5. Engineers India Limited (EIL) has inked a Memorandum of Agreement (MoA) with NTPC Limited to carry out collaborative work in the domain of Carbon Capture Utilization & Storage (CCUS), Green Fuel, Green Chemicals including Green Hydrogen, Green Ammonia, Green Fertilizers, Bio-Fuels, Decarbonization, Waste Handling, Water, Ash, etc., paving the way for a clean energy transition.
6. Company has also executed a collaborative agreement with CSP Sunrise Pty Ltd and its group companies Sunrise CSP India Pvt Ltd and Sunrise CSP International Ltd, an esteemed player in the renewable energy sector based in Australia.
7. Company has also signed an MoU with KIIFCON Pvt. Ltd. (KIIFCON), a Consultancy Organisation under Kerala Infrastructure Investment Fund Board (KIIFB) to jointly explore, identify, secure, and execute consultancy projects. Kerala Infrastructure Investment Fund Board (KIIFB) is the principal funding arm of Government of Kerala and aims to channelize fund for critical and large public infrastructure projects in Kerala.
8. EIL is also the Project Management Consultant (PMC) for the Mongol Refinery Project being executed under the G2G framework through Line of Credit (LoC). Mongol Refinery is one of the challenging projects being executed under extreme climatic conditions with temperature ranging from (-) 35 deg C to (+) 40 deg C.
9. Company has recorded substantial growth in the Business for Year 22-23 by securing over INR 4500 Crores vis-a-vis approx. INR 1700 Crores secured in FY 21-22. Besides other areas, significant jump is witnessed in the business secured from international assignments to around INR 600 Crores from less than INR 50 Crores in FY 21-22.
10. On international front company has signed a MoA with M/s DEEP.KBB GmbH, Germany for Salt Cavern Projects. The alliance will jointly pursue Basic Design, Detail Engineering, Project Management and Construction Supervision Services for underground and above ground Salt Cavern Storage Facilities for Hydrocarbons and other products like Hydrogen & Carbon Dioxide for Indian and International clients, in line with EIL’s vision “To be a Global Leader offering Total Energy Solutions for a Sustainable Future.”
11. Engineers India Limited (EIL), ONGC Energy Centre Trust (OECT) and CSIR-IIP have signed a Memorandum of Agreement (MoA) for development and commercialization of technology for Recovery of Rare Gases from fossil fuel reserves.
12. Oil India Limited (OIL) and Engineers India limited (EIL) inked a Memorandum of Agreement (MoA) to carry out niche technological studies and feasibility reports for the Upstream, Midstream and the Downstream value chain including HSE aspects.
13. Engineers India Limited (EIL) has entered into a Memorandum of Understanding (MoU) with Munitions India Limited (MIL) for execution of Plant Modernization & Infrastructure Projects of MIL. MIL is India’s biggest manufacturer and market leader, engaged in Production, Testing Research & Development and Marketing of comprehensive range of ammunition & explosives for Army, Navy, Air force & Para-Military Forces. Thus, this MoU heralds EIL’s foray into Defence sector, giving a fillip to the diversification into newer areas.
14. The Ministry of Housing and Urban Affairs (MoHUA) has signed a Memorandum of Agreement (MoA) with Engineers India Limited (EIL), to develop Waste to Energy and bio-methanation projects in cities with a population of million plus. Recently, the thrust on sustainable solid waste management has been strengthened under the ambit of Swachh Bharat Mission-Urban 2.0, with the overall vision of creating garbage-free cities and focusing on this objective, MoHUA has decided to set up large-scale solid waste processing facilities in million plus cities. The initiative will result in additional processing capacity of 15,000 TPD for Bio-Methanation and 10,000 TPD for Waste to Energy respectively.
15. Engineers India Limited (EIL) has signed a contract with Guyana Power and Gas Inc. (a wholly owned company of Govt. of Guyana) to provide Consultancy Services for Integrated NGL Plant and 300 MW CCGT Power Plant project in Guyana.

In last 3 Years the stock gave a return of 215.11% as compared to the rise of Sensex and Nifty in the same period.

EIL's business operations span the hydrocarbon value chain as well as diversified areas of Metallurgy, Infrastructure, Bio Fuels & Green Hydrogen which helps it to stay into the competition and cater to the demands of changing world economics and environment. It has successfully diversified into high potential sectors of Infrastructure, Water & Waste Management, Solar & Nuclear power, and Fertilizer along with initiating business development activities in sectors like Bio Fuels, SMART Cities, LNG Terminals, Ports and Harbours, Defence etc., as part of possible diversification initiatives and aligning with Government of India initiatives company has positioned itself in very comfortable position to enjoy a growing stream of orders and secured business. Company has recorded substantial growth in the Business for Year 22-23 by securing over INR 4500 Crores vis-a-vis approx. INR 1700 Crores secured in FY 21-22. Besides other areas, significant jump is witnessed in the business secured from international assignments to around INR 600 Crores from less than INR 50 Crores in FY 21-22. Considering company’s presence in domestic as well as international markets, leadership position in refineries business, foray into futuristic segments such as Green Hydrogen, renewable energies and defence along with growing financial performance and huge clientele of private as well as government companies, investors may invest in this PSU for long term period.

Analyst : HET ZAVERI​

info@smartinvestment.in

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