Envirotech Systems Limited
Company
| Website 🔗 |  |
| Business Activity | Manufacture |
| Division | Industrial Equipment |
| Sub-class | Acoustic Engineering – Noise Control Products |
| Location | Noida, Uttar Pradesh |
| Establishment Year | 2007 |
Management
| Managing Director | Manoj Kumar Gupta |
| Educational Qualifications | Bachelor of Science (Kanpur University, 1993) Diploma in Mechanical Engineering (Lucknow Polytechnic) |
| Experience | Over 20 years of experience in the acoustic insulation industry. |
| Annual Salary | ₹ 120 Lakhs |
| Total Number of Employees | 98 |
About
Envirotech Systems Limited is a prominent acoustic engineering company specializing in the design, manufacture, and installation of noise control solutions for various industries and applications. The company has solidified its position as a trusted provider of high-quality acoustic products and services, catering to a diverse clientele across India.
Products and Services:
Acoustic Enclosures:
Customized enclosures designed to reduce noise from various sources such as gas turbines, steam turbines, compressors, diesel generators, pumps, conveyors, and other industrial machinery.
Noise Test Booths:
Soundproof booths designed to eliminate external noise interference during testing, are used in applications such as automotive testing, speaker testing, and sound purity testing.
Engine Test Rooms:
Acoustically treated rooms are designed to contain the noise generated during engine testing, ensuring a controlled and isolated environment for accurate measurements.
Anechoic and Semi-Anechoic Chambers:
Specialized chambers are designed to absorb sound reflections, creating a free-field environment for precise acoustic measurements and testing.
Noise Barriers:
Various types of noise barriers, including polycarbonate, metallic, and echo barriers, are designed to reduce noise pollution from highways, railways, industrial facilities, and other sources.
Acoustic Louvers:
Aerodynamically designed sound baffles that allow airflow while minimizing noise radiation, are commonly used in conjunction with machinery enclosures and sound control rooms.
Metal and Wooden Acoustic Doors:
Fire-retardant, fireproof, and fire-check metal doors and frames, as well as wooden acoustic doors, designed to provide sound insulation and fire protection.
Clients:
Envirotech Systems Limited caters to a diverse clientele across various industries and sectors, including:
- Oil and Gas
- Manufacturing
- Power Generation
- Cement and Steel
- Automotive
- Construction
- Commercial
- Architectural
- Environmental
Manufacturing Process:
The company employs advanced software and techniques, such as 3D modelling and finite element analysis (FEA), to ensure the optimal design and functionality of its products.
The company utilizes CNC machines and automated systems for precise cutting, shaping, and assembly of components.
Raw Materials:
Carbon Steel, Stainless Steel, and Alloy Steel:
Used for the construction of various acoustic products, providing structural integrity and durability.
Rockwool, Mineral Wool, and Fiberglass:
Used as acoustic insulation materials, effectively absorbing sound waves and reducing noise transmission.
Acoustic Foam and Sound-Absorbing Panels:
Used to enhance sound absorption and create a controlled acoustic environment within enclosures and chambers.
Suppliers:
The company maintains relationships with suppliers of various materials, including:
- Steel Manufacturers
- Acoustic Insulation Material Suppliers
- Hardware and Accessory Suppliers
Other Key Aspects:
Manufacturing Facility & Infrastructure:
State-of-the-art facilities capable of working with carbon steel, stainless steel, and alloy steel, using materials like rock wool and multiple sound-dampening & absorbing materials. Their facilities include welding, painting, and fabrication areas for large structures and equipment.
Revenue – Category
Revenue – Region
Audit and Legal
Auditor’s Remarks:
The auditors did not make any material qualifications about the company’s restated financial information.
Non-Compliances and Other Issues:
Delay in Filing of Statutory Forms with the Registrar of Companies (RoC):
The company has incurred penalties for delays in submitting statutory forms to the RoC. These delays have resulted in additional fees being imposed at the time of filing.
Delay in Filing of GSTR-3B and EPF Returns:
The company has experienced slight delays in filing GSTR-3B and EPF returns during the financial years 2021-22, 2022-23, and 2023-24. These delays were primarily due to technical issues, internal reconciliation challenges, and staffing shortages.
Trademark Application Objections:
The company’s trademark applications under Class 17 and Class 6 of the Trademark Act have been marked as “Objected.”
Non-Provision of Gratuity:
The company has not made any provision for gratuity in its restated and audited financial statements.
Contingent Liabilities:
As of March 31, 2024, Envirotech Systems Limited has contingent liabilities amounting to ₹61.10 lakhs. These liabilities primarily pertain to bank guarantees and letters of credit (LCs) issued by the company.
Legal Cases:
Cases Filed Against the Company
Cases Filed by the Company
Tax Proceedings against the Company:
Income Tax Demand (U/s 143) – 1 case involving ₹0.96 lakh
TDS Demand – 1 case involving ₹0.71 lakh
SWOT Analysis
Strengths
| Early Market Entry: Envirotech Systems Limited has the advantage of being an early entrant in the acoustic insulation sector. This has allowed the company to establish a strong brand reputation and build a loyal customer base. |
| Strong Technical Expertise: Envirotech Systems Limited has an experienced technical team. This team is capable of handling projects and delivering customized solutions to meet the specific needs of its clients. |
| Focus on Innovation: The company is committed to innovation and has a dedicated research and development (R&D) department. This focus on innovation has enabled the company to develop a wide range of products and services that meet the evolving needs of its customers. |
Weaknesses
| Limited Capital: The company has limited capital, which could restrict its ability to expand its operations and pursue new opportunities. |
| Limited Geographic Reach: The company’s operations are currently concentrated in India. This limited geographic reach could restrict its growth potential. |
| Infrastructure Limitations: The company’s manufacturing facility is not fully automated and may have limited capacity to handle very large orders. This could restrict its ability to compete for large-scale projects. |
Opportunities
| Growing Market: The acoustic insulation market is expected to grow significantly in the coming years, driven by factors such as increasing awareness of noise pollution, stricter regulations, and the growth of end-user industries such as construction, automotive, and aerospace. |
| Government Initiatives: The Indian government’s focus on infrastructure development is expected to create new opportunities for the company. |
| Technological Advancements: The company can leverage technological advancements to improve its products and services and enhance its operational efficiency. |
Threats
| Competition: The company faces competition from both established players and new entrants in the acoustic insulation and noise control industry. |
| Economic Slowdown: An economic slowdown in India or globally could adversely affect the demand for the company’s products and services, particularly in the industrial and commercial sectors, which are sensitive to economic cycles. |
| Fluctuations in Raw Material Prices: The company is exposed to fluctuations in the prices of raw materials, such as steel and insulation materials. Significant increases in raw material prices could affect the company’s profitability if it is unable to pass on the increased costs to its customers. |
| Technological Disruptions: Rapid technological advancements in the industry could render existing products or processes obsolete, requiring the company to invest in new technologies to remain competitive. |
Porter’s Five Forces1
| Threat of New Entrants | MODERATE |
| While the industry requires technical expertise and capital investment, there are less stringent barriers compared to industries with higher capital or regulatory requirements. |
| Bargaining Power of Suppliers | LOW |
| The company sources materials from a network of suppliers without long-term contracts, indicating flexibility in supplier selection and reduced dependence on specific suppliers. |
| Bargaining Power of Buyers | MODERATE |
| The company serves diverse industries, reducing reliance on single clients. However, some clients, particularly larger companies, may have greater bargaining power due to order volumes and competitive options. |
| Threat of Substitute Products or Services | LOW |
| While alternative noise control solutions exist, Envirotech’s customized products and expertise create a niche market with limited direct substitution threats. |
| Rivalry Among Existing Competitors | MODERATE |
| The industry has few organized players, but competition may arise from smaller, localized competitors or larger companies expanding into the acoustic insulation sector. |
Peer Comparison
Envirotech Systems Limited has no listed peers for a meaningful comparison of financial metrics.
Green Box
Customer-Centric Approach:
The company has a large customer database across various segments and is known for its ability to understand customer requirements and deliver customized solutions.
Untapped Market Potential:
Despite its presence in various industries, the company still has significant potential to expand its geographical reach and market penetration, particularly in regions where it currently lacks a physical presence.
IPO Funds:
Purchase of Land and Building for Setting Up a Factory:
The company aims to expand its manufacturing operations by acquiring additional land and building through the IPO. This expansion will enable the company to increase its production capacity and cater to the growing demand for its acoustic products and solutions.
Funding of Working Capital Requirements:
The company plans to utilize a portion of the IPO proceeds to meet its working capital needs. This includes managing inventory, trade receivables, and other short-term financial requirements, ensuring smooth and efficient operations.
Industry Outlook:
Favourable Macroeconomic Conditions:
The positive macroeconomic outlook for India, with continued growth projected in the coming years, provides a favourable environment for the company’s business operations and expansion plans.
Global Market:
The global acoustic insulation market is projected to grow at a CAGR of 3.9% from 2021 to 2026, reaching a value of USD 17.07 billion.
Indian Market:
The Indian acoustic insulation market is expected to grow at a CAGR of around 7% from 2021 to 2026, indicating a faster growth rate compared to the global market.
NVH Testing Market:
The India NVH (Noise, Vibration, and Harshness) Testing market is anticipated to project robust growth with a CAGR of 7.33% through 2029, highlighting the increasing demand for noise and vibration control solutions across various industries.
Amber Box
Debt-to-Equity Ratio: 0.46
Negative Operating Cash Flow:
The company had negative operating cash flow for FY 2023
Red Box
Limited Capital and Infrastructure:
The company’s growth potential is somewhat constrained by limited capital, which may hinder its ability to expand at an optimal pace and take up large-scale projects.
Images
- The force value of “LOW” is considered good Click Porter’s Five Forces article for more information. ↩︎
Disclaimer: The above information/document is based on publicly available sources and has been issued solely for educational and informational purposes and should not be considered as investment advice or as a Buy/Sell recommendation, or as a research report. Although due diligence has been done to ensure the accuracy of the data presented, the website or authors are not responsible for any decision arising out of an inadvertent mistake or error in the data presented on the website. The authors may also have equity shares in the companies mentioned in this report adhering to provisions of regulation 16 of the Securities and Exchange Board of India (Research Analysts) Regulations, 2014. The investor is advised to consult his/her investment advisor and undertake further due diligence before making any investment decision in the companies mentioned. Authors are not liable for any financial gains or losses due to investments made as per the information provided on this website (StocKernel.com).