Delta Investment Advisors

Technocraft Ventures Limited

Incorporated in October 1998, Technocraft Ventures is a turnkey EPC contractor for public water and wastewater infrastructure. It builds sewerage networks, sewage treatment plants, water transmission mains, roads and electrical substations for state governments and urban local bodies, and operates several of these assets under O&M contracts of 5 to 15 years. Water and wastewater was 85.4% of FY26 revenue and government clients 99.98%. It has laid 1,200 km of sewer line and completed STPs of up to 56 MLD.

DRHP filed: August 8, 2025 (RHP dated July 30, 2026)

IPO open & close: August 7, 2026 to August 11, 2026

Listing date: August 14, 2026 (tentative), on BSE and NSE

BRLM: Khambatta Securities Limited

Auditor: Rishi Kapoor & Company, Chartered Accountants

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Delta's View:

No Material Listing Gains | Skip

Technocraft is a government-dependent EPC contractor in a fragmented, tender-driven business with limited pricing power. Execution has been steady, with revenue growing at 23.5% CAGR over FY24-26 and RoCE at 24% in FY25 and 29% in FY26. However, the profits do not convert into cash (cumulative OCF of ~20 cr against post-tax EBITDA of ~118 cr over FY24-FY26) with stretched receivable days (~93 days in FY26) and working capital needs of business (40-48% of revenue is needed in working capital only, even after excluding cash & debt). 150 cr of the 202 cr fresh issue goes to funding working capital. 77% of the order book sits under AMRUT 2.0, now in a completion-phase extension. At 9.8x EV/EBITDA and 19.4x P/E, it prices below the peer median of 12.4x, though a large part of that discount reflects the conversion risk in the order book. Given the business quality on offer, we would wait for a more attractive price to evaluate.

One can expect only flat to moderate listing gains as per current GMP 6% (August 5, 2026), provided the GMP sustains.

• It is a turnkey EPC contractor for public wastewater and water infrastructure, winning orders from government clients at L1 in competitive e-tenders. Government clients were 99.98% of FY26 revenue. The construction industry is highly fragmented because fixed capital requirements are low, with capex limited to equipment unlike manufacturing. Receivable days (average) were 93 in FY26, against 103 in FY25.

• The profits do not convert into cash flows, the cumulative operating cash flow over FY24-26 was only 20 cr against post-tax EBITDA of 118 cr. The business is working capital intensive rather than capital intensive. Gross block was 20.1 cr against FY26 revenue of 345 cr and capex was 1.6 cr, while working capital, excluding cash and debt, averaged 48% of revenue in FY25 and 40% in FY26. Receivable days were ~93 in FY26.

• Revenue concentration has increased. Rajasthan and Uttar Pradesh were 88.6% of FY26 revenue, with Rajasthan rising to 63.1% from 32.3% in FY24 on the AMRUT 2.0 wins at Kota and Bikaner, while UP fell from 61.2% to 25.5%. The company billed 19 customers in FY26 with the top two, Nagar Nigam Kota and Nagar Nigam Bikaner, at 48.9% of revenue and the top ten at 95.7%. Both of those contracts are in their closing stages.

• Order book is adequate and slightly ahead of peers. Unexecuted value was 1,321 cr as on July 15, 2026 across 19 projects, with a further 196 cr where the company is L1 at Delhi Jal Board. On the March 31, 2026 book of 1,236 cr, which is 3.58x times of FY26 revenue against a peer median of 3.07x.

• The company was awarded 13 projects from 36 net solo bids since FY24, a 36.1% conversion. Seven of 19 ongoing projects carrying 918 cr, or 69.5% of the order book, were bid through joint ventures formed because qualification thresholds were not met alone. Conversion as lead JV partner is 6 of 8, and as a non-lead partner 0 of 3.

• Promoter group entity VVIP Infratech Limited, a BSE listed wastewater and electrical contractor, is controlled by Praveen Tyagi, brother of promoter and Executive Director Rekha Tyagi. It was the largest supplier in FY24 and FY25 at 31.8% and 26.6% of cost of revenue and the second largest customer at 19.1% and 18.2% of revenue, both falling to 4.76% and nil in FY26. It is currently the JV partner on four projects carrying ₹779 cr of unexecuted value, 59% of the order book.

• 77% of the order book runs through AMRUT 2.0, whose mission period ended March 31, 2026 and which is now in a one-year completion extension with no fresh sanctions. 894 cr of the book had zero execution as on July 15, 2026, with three of those four projects awarded between February and June 2026 in Bihar and Odisha, where the company has not worked before. Payment follows central release to states, where 63,977 cr is approved against 11,756 cr released.

• The IPO ask valuation is at a 9.8x EV/EBITDA (19.4x P/E) on FY26, against a peer median of 12.4x EV/EBITDA across Denta Water, EMS, Enviro Infra and Welspun Enterprises. On enterprise value to order book the company is at 0.55x against a peer median of 1.06x.

Business

• Technocraft executes turnkey EPC contracts for municipal corporations, jal nigams and urban development corporations, covering sewerage networks, sewage treatment plants, water transmission mains, roads and electrical substations, followed by O&M of 5 to 15 years on many contracts. FY26 revenue was 345 cr against 226 cr in FY24. Work is executed under AMRUT, AMRUT 2.0, Namami Gange, Jal Jeevan Mission and PMGSY, and one ADB funded project at Udaipur.

• Water and wastewater infrastructure was 85.4% of FY26 revenue, roads and highways 12.9% on a single contract at Saharanpur, and standalone O&M 1.7%. Urban infrastructure at 8.9% and electrical transmission at 7.5% of FY25 revenue contributed nothing in FY26 and have no live orders.

• The core work is laying sewer pipelines of 120mm to 1600mm diameter, building house connection chambers and constructing treatment plants on SBR and UASB technology to National Green Tribunal discharge norms. In dense urban areas the company uses microtunnelling and horizontal directional drilling instead of open excavation, as on the Delhi Jal Board transmission main replacement from the Bhagirathi WTP.

• Clients include Nagar Nigam Kota and Bikaner, RUDSICO, Delhi Jal Board, UP Jal Nigam, Municipal Corporation Indore, Bihar Urban Infrastructure Development Corporation and WATCO Odisha. To date the company has laid 1,200 km of sewer line, of which 750 km is commissioned, and completed STPs of 56 MLD at Ghaziabad, 40 MLD at Shahjahanpur and 3 MLD at Pilkhuwa.

• Key inputs are steel, cement, pipes, bitumen, fuel and electrical and mechanical components, procured centrally from Noida. Cost of revenue was 74.8% of FY26 revenue against 81.4% in FY24, with the top ten suppliers at 47.3% of it. There is no manufacturing capacity; owned machinery is limited largely to road building plant at Saharanpur, with site equipment hired project-wise.

Promoters and Leadership

• Managing Director Sanjay Tyagi, 61, holds a diploma in civil engineering from Aligarh Muslim University and worked as an engineer at the Ghaziabad Development Authority from January 1990 to March 2007. He joined the board in April 2007 and became MD in May 2007.

• The company was incorporated in October 1998 with Rekha Tyagi, his wife, as a founding director and and she continues as Executive Director. Their son Kartikey Tyagi, 28, a University of Pennsylvania graduate who joined in January 2021, has been Whole-Time Director and Chief Financial Officer since April 2025.

Shareholding Pattern

• Promoters and promoter group hold 100% pre-issue across seven shareholders, with no institutional, financial or employee shareholder on the register. Kartikey Constructions, a partnership firm in which Rekha Tyagi holds 70% and Sanjay Tyagi 30%, holds 83.02%. Promoters & Promoter group holding falls to exactly 70.00% post-issue, with public float at 30.00%.

Issue Details

Fresh issue size - Amount → 202 cr; To be utilized in -

○ Funding working capital requirements → 150 cr

○ General Corporate Purposes & Others

Offer For Sale size - Amount → 50 cr;

○ The entire offer for sale of 23,76,000 shares is by Kartikey Constructions, the promoter partnership firm.

Financials