Concord Enviro Systems Ltd

Financial Performance

• Revenue from operations: INR 853 million in Q1 FY27 vs INR 1,024 million in Q1 FY26.
• EBITDA: negative INR 149 million in Q1 FY27 vs negative INR 9 million in Q1 FY26.
• Net loss for the quarter: INR 176 million vs PAT INR 41 million in Q1 FY26.

Operations & Portfolio

• Order book at INR 699 crores; majority deliverable in this financial year.
• H-Xtreme heat exchanger: up to 90% efficiency; significant fuel savings; traction expected in next two quarters.
• First ZLD order from Europe: EUR 600,000; revenues in Q3 FY27; margins higher in Europe.
• Roserve Water-as-a-Service platform performing well; marquee projects; growing recurring revenues.
• Delivered first REM membrane project; partnership with NALA Membranes; textile/paper effluent focus.
• WaHa partnership: stake <2%; USD 575,000 invested; exclusive rights for India and UAE.
• New Group CFO Shleshank Laheri introduced.

Order Book & Pipeline

• Orders worth INR 1,430 million signed; INR 1,260 million from steel manufacturers; added to order book.
• Healthy pipeline around INR 3,200 crores.
• Order intake guidance for FY27: about INR 1,000 crores; ~INR 200 crores already done.
• Management expects most orders to convert in 3–4 months.

Guidance & Outlook

• EBITDA margin target 14–16%; temporary investment impact; stabilizes after revenue crosses INR 850 crores; two years.
• Q2 FY27 expected to improve; supply chain normalization by end of Q2 FY27; growth in H2 FY27.

Q&A Highlights

• Revenue disruption quantified: ~INR 50 crores impact; INR 15 cr from trading, INR 42–43 cr manufacturing.
• Europe ZLD order timing and margins discussed.
• WaHa stake details and investment disclosed.
• Semiconductor route: working with US partner for Micron; membrane replacement first, then projects.
• Carbon capture: government push; 3–5 year horizon; biological route favored.
• Competitors in ZLD: Ion Exchange, Thermax, Arvind Envisol; Concord near Ion Exchange.
• Data centers synergy: WaHa dehumidification for data centers; large opportunity.

Issue overview

• Type of issue: IPO of equity shares.
• Total issue size and net proceeds reported; revisions due to higher offer-related expenses.
• Main objectives: capex, working capital, acquisitions, and general corporate purposes.

Utilisation of proceeds

• Utilisation aligns with disclosures; no material deviation.
• Object 1: partial utilisation; remaining funds idle.
• Object 2: utilisation not recorded yet.
• Object 3: partial utilisation; some funds idle.
• Object 4: fully utilised for prepayment of borrowings.
• Object 5: fully utilised for working capital.
• Object 6: not utilised.
• GCP: largely utilised; small residual.
• Unutilised funds are parked in fixed deposits and MA/escrow.

Governance and compliance

• Shareholder approvals not applicable for deviations; government approvals to be obtained per schedule.
• No material adverse events or regulatory actions reported.
• No governance concerns or related party issues identified.
• Monitoring agency notes data based on issuer information; not an audit.

GCP

• GCP utilisation: working capital components funded.
• Board approval for GCP allocation not explicitly stated.

Meeting Details

• Date: August 12, 2026; conference call with investors.
• Type/Mode: group virtual conference call.
• Purpose: discuss quarter ended June 30, 2026 results.
• Organiser: Concord Enviro Systems Limited (investor-facing).
• Key participants: Management presented the results.
• Recording: audio recording available on issuer's investors page.

Business Overview

• Global leader in water and wastewater treatment, with ZLD focus.
• In-house design, R&D, manufacturing, installation, O&M, and IoT solutions.
• Backward-integrated manufacturing at Vasai, India and Sharjah, UAE.
• Revenue streams from EPC/system sales, consumables, and O&M.

Operational Highlights

• Order book at INR 6,993 Mn as of 30 June 2026.
• First European ZLD order in critical mineral recovery for battery market.
• HXtreme Heat Exchanger launched; gaining market traction.
• WaHa licensing deal expands water technology portfolio in India/UAE.

Financial Performance

• Q1FY27 revenue from operations INR 853.47 Mn; -16.6% YoY.
• EBITDA at INR -149.41 Mn; EBITDA margin -17.5%.
• PBT INR -197.10 Mn; PAT INR -175.69 Mn.
• Total income INR 917.70 Mn; Other income INR 64.23 Mn.
• Geography: Within India INR 709.64 Mn; Outside India INR 143.83 Mn.
• FY26 revenue INR 5,578.56 Mn; FY25 INR 5,944.40 Mn.

Capital Structure & Liquidity

• No material debt or liquidity actions disclosed.
• Exclusive WaHa licence + investment: India/UAE rights and global manufacturing partnership.
• Second US technology investment: USD 2 Mn.
• Backward-integrated manufacturing facilities: Vasai (India) and Sharjah (UAE).

Strategic Priorities & Outlook

• Execution normalization expected by end of Q2 FY27 as supply chains recover.
• Robust order book and pipeline to drive sustainable FY27 growth.
• Europe entry and WaHa licensing broaden product and market reach.
• R&D focus: 9 patents in India, 21 filings; 31-member team.
• Green India opportunities in carbon capture, water reuse, ZLD.

Risks & Mitigation

• Supply chain disruptions in the Middle East impacted Q1 results.
• Execution risk on large ZLD projects; mitigated by in-house manufacturing and tech-led offerings.

Governance & Leadership

• No governance changes disclosed.
• Leadership includes Chairman & MD; no changes announced.

Business Overview

• Concord Enviro is a global water and wastewater treatment leader focused on ZLD.
• In-house design, R&D, manufacturing, installation, O&M, and IoT-enabled solutions.
• Backward-integrated manufacturing at Vasai (India) and Sharjah (UAE), with presence across five continents.
• WaHa exclusive license for India/UAE plus a global AWG manufacturing partnership.
• Roserve Water-as-a-Service platform advancing; cross-selling across client base.
• H-Xtreme heat exchanger and REM membranes represent key R&D-driven growth pillars.
• European ZLD expansion marked by first order.
• US$2 million equity investment in US polymer company to boost advanced membranes.

Operational Highlights

• Order book at INR 6,993 Mn as of 30 June 2026.
• First European ZLD order secured in critical mineral recovery for battery production.
• HXtreme launch; REM membranes commercialized; Roserve platform progressing.
• WaHa exclusive India/UAE license with global AWG manufacturing partnership.
• Solar PV orders: two; one greenfield, one efficiency upgrade; commissioning underway.
• Major Indian steelmaker order for potentially largest ZLD in India.
• US$2 million equity investment in US polymer company to access advanced membranes.
• Q1FY27 revenue declined to INR 853.47 Mn, down 16.6% YoY.

Financial Performance

• Revenue from operations: INR 853.47 Mn in Q1FY27, down 16.6% YoY.
• EBITDA: negative INR 149.41 Mn; EBITDA margin -17.5%.
• PAT: negative INR 175.69 Mn for the quarter.
• Total income: INR 917.70 Mn, down 21.9% YoY.
• Within India revenue: INR 709.64 Mn; Outside India: INR 143.83 Mn.
• Execution normalization expected by end of Q2 FY27.

Capital Structure & Liquidity

• No material debt or equity changes disclosed for the quarter.

Strategic Priorities & Outlook

• Normalization by end of Q2 FY27; capitalize on strong order book and technology offerings.
• Focus on H-Xtreme, REM, and Roserve to improve margins and cross-sell.
• Leverage WaHa partnership for cross-vertical growth (solar, pharma, batteries).
• Regulatory tailwinds from GOI wastewater and carbon capture initiatives.

Risks & Mitigation

• Middle East supply-chain disruptions impacted Q1; normalization expected by Q2 FY27.
• Execution risk on large ZLD projects; emphasis on operational efficiencies.
• Regulatory/geopolitical risks in international markets.

Governance & Leadership

• No significant governance changes disclosed.

Deviation status and IPO fund details

• Purpose: Deviation/variation statement confirms no deviation in IPO proceeds.
• Mode of fund raising: Public issue.
• Monitoring by applicable agency; agency name not disclosed.
• Deviation in use of funds: No.
• Original/Modified objects: Not applicable due to no deviation.
• Auditors' comments: Nil.

Meeting Details

• Earnings conference call on 12 August 2026 at 10:00 AM IST (virtual group call).
• Q1 FY27 results to be announced on 11 August 2026 and approved by the Board.
• Organiser: Concord Enviro Systems Ltd.
• Key participants: Chairman & Managing Director, Executive Director, Head of Strategy and M&A.
• Purpose: Discuss Q1 FY27 earnings results.
• Mode: Virtual conference call; dial-in numbers provided.

Dematerialisation status

• No demat/remat requests were received during the quarter ended 30th June 2026.

Target and investment

• Target: Rochem Separation Systems (India) Private Limited (RSSIPL), a wholly owned Concord subsidiary in water treatment.
• Industry: water and wastewater treatment, country India.
• Turnover to date: Rs 402.08 Cr; net worth Rs 152.78 Cr; PAT Rs 2.05 Cr.
• Investment: 3448 equity shares at Rs 30,555.55 per share; total Rs 10.54 Cr.
• Form: rights issue, ratio 29:2; premium Rs 30,455.55 per share.
• Completion status: completed; RSSIPL remains wholly owned.

Related party and governance

• RSSIPL is a wholly owned subsidiary; transaction is related party.
• Arms-length: the transaction is at arm's length.
• Promoter group: RSSIPL is part of the promoter group.

Purpose and regulatory

• Purpose: finance RSSIPL's brownfield expansion at Vasai.
• Regulatory approvals: not applicable.
• Timeline: completion completed.

Background of target

• Date of incorporation: 19 November 1991.
• Three-year turnover: 2023-24 347.35 Cr; 2024-25 406.95 Cr; 2025-26 402.08 Cr.
• Products/services: water treatment systems, pollution control equipment, bio filters, membrane-based recovery, O&M.
• Presence: India.