Sattva Engineering Construction Ltd IPOSATTVAENGG

The IPO opens on 26 Aug 2025 & closes on 29 Aug 2025.

Sattva Engineering Construction Limited was originally incorporated as 'Sattva Engineering Construction Private Limited' a private limited company dated December 21, 2005. Subsequently, Company name was changed from 'Sattva Engineering Construction Private Limited' to 'Sattva Engineering Construction Limited' and a fresh certificate of incorporation to change of name and conversion to a limited company was issued by the Registrar of Companies, Central Registration Centre dated December 23, 2024. Sattva Engineering Construction is an ISO certified engineering, procurement and construction (EPC) company engaged in providing water resource management solutions which includes the Water Supply Scheme (WSS) with underground and overhead tank, Under Ground Sewerage System (UGSS), Sewage Treatment Plants (STP) and Water Treatment Plants (WTP) primarily for government authorities/bodies. It also offer operation and maintenance services for the STP projects as a part of the EPC contract. The Company commenced its operations in 2009. Currently it works operations only in the state of Tamil Nadu. As of December 31, 2024, it completed more than 50 projects and is in process of executing 15 ongoing projects within the state of Tamil Nadu. It caters to both government and private sector clients. Under the WSS, Company design and construct large underground and overhead water tanks for storage and supply of potable/drinking water along with pump house, laying the pipeline from the water tank and achieving house service connections including electromechanical works. Under the UGSS, the sewage is drawn through the house service connection, laying the sewage pipeline connected to machine holes (pre-cast or cast-in-situ), collection wells and pump house including other civil structures, electromechanical equipments and instrumentation. Under the STP, it design, engineer, build, commission and operate sewage treatment plant of varying capacities which typically includes construction of inlet chamber, screen and grit chamber, primary clarifier, sequential batch reactor basin, chlorine contact tank, sludge thickener, digestor, bio-gas tank and other civil structures, electromechanical equipments and instrumentation. Under the WTP, it design, engineer, build and commission water treatment plant of varying capacities for treatment of river or lake water which typically includes construction of raw water pumping station, inlet chamber, screen chamber, clariflocculator, filter press, rapid gravity sand filter beds, chlorinator and other civil structures, electromechanical equipment and instrumentation. The Company is planning an IPO of 47,16,800 equity shares of Rs 10/- each through fresh issue.

Sattva Engineering Construction Ltd IPO will close on 29 Aug 2025.

<ul><li>Strong Order Book from Urban Local Bodies and Government bodies with repeat orders.</li><li>Established track record for project execution.</li><li>In house designing, engineering and execution team.</li><li>End to end project management and execution capabilities.</li><li>Managing diverse segments of infrastructure projects.</li><li>Experienced management team.</li></ul>

<table class="table"> <thead> <tr> <th>S.No</th> <th>Promoters Name</th> <th>Pre Issue Shares</th> <th>Pre Issue Percentage</th> <th>Post Issue Shares</th> <th>Post Issue Percentage</th> </tr> </thead> <tbody> <tr> <td>1</td> <td>Santhanam Seshadri</td> <td>5494500</td> <td>43.09</td> <td>5494500</td> <td>31.45</td> </tr> <tr> <td>2</td> <td>R Sekar</td> <td>4091799</td> <td>32.09</td> <td>4091799</td> <td>23.42</td> </tr> <tr> <td>3</td> <td>Jagachchandarr Sekar Uthra</td> <td>1275182</td> <td>10</td> <td>1275182</td> <td>7.3</td> </tr> <tr> <td>4</td> <td>Uth ra Sekar</td> <td>127519</td> <td>1</td> <td>127519</td> <td>0.73</td> </tr> </tbody> </table>

<ul><li>Our employees may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and the same may results into imposition of criminal penalties, fines, revocation of regulatory approvals and harm to our reputation, any of which could form a material adverse effect on our business.</li><li>Some of our Directors do not have experience of being a director of a public listed company.</li><li>Our funding requirements and the proposed deployment of Net Proceeds are not appraised by any independent agency and are based on management estimates which may be subject to change based on various factors, some of which are beyond our control. Further, deployment of funds raised through this Issue shall not be subject to monitoring by any monitoring agency.</li><li>We have issued the following shares in the last one year prior to the date of this Draft Red Herring Prospectus, which may be at a price lower than the Issue Price.</li><li>The average cost of acquisition of Equity Shares by our Promoters could be lower than the floor price.</li><li>We have presented certain supplemental information of our performance and liquidity which is not prepared under or required under Indian GAAP</li><li>The company bid for Water Supply Scheme ("WSS") with underground and overhead tank, Under Ground Sewerage System ("UGSS"), Sewage Treatment Plants ("STP") and Water Treatment Plants ("WTP") primarily for government authorities/bodies. These projects are partly funded by the Central Government under schemes like the Atal Mission for Rejuvenation and Urban Transformation("AMRUT") and the Jal Jeevan Mission ("JJM") along with contribution from states or ULBs under their respective schemes. Any reduction in budgetary allocation to this sector may affect the number of projects that the government authorities/bodies may plan to develop in a particular period. the company business is directly and significantly dependent on projects awarded by them.</li><li>The company business is working capital intensive. If its experience insufficient cash flows or are unable to access suitable financing to meet working capital requirements and loan repayment obligations, its business, financial condition and results of operations could be adversely affected.</li><li>Quoting for a contract involves various management activities such as detailed project study and cost estimations. Inability to accurately estimate the cost may lead to a reduction in the expected rate of return and profitability estimates.</li><li>The company has heavily dependent on government or government-funded entities for its business, which exposes it to various risks, including regulatory scrutiny, delays in receivables, project execution risks, and policy-related uncertainties.</li><li>Its failure to successfully implement the company expansion plan to other parts of South India could adversely affect its business and results of operations.</li><li>The company ongoing projects are exposed to various implementation risks and uncertainties and may be delayed, modified or cancelled for reasons beyond the company control, which may adversely affect its business, financial condition and results of operation.</li><li>The company Order Book may not be representative of its future results and the company actual income may be significantly less than the estimates reflected in its Order Book, which could adversely affect the company business, financial condition, results of operations and prospects.</li><li>The company derive a significant portion of its revenues from a limited number of clients. The loss of any significant clients may have an adverse effect on the company business, financial condition, results of operations, and prospects.</li><li>Disclosures made in the chapter "Promoter and Promoter Group" are limited to the information available in public domain.</li><li>Any adverse revision to the company credit rating by rating agencies may adversely affect its ability to raise additional financing and the interest rates and other commercial terms at which such funding is available.</li><li>The company derive a significant portion of its revenues from repeat clients. Any loss of, or a significant reduction in the number of repeat clients could adversely affect our business, results of operations, financial conditions and cash flows.</li><li>The company rely on its in-house designing, engineering and construction teams for project execution. Loss of key employee(s) may have an adverse effect on the execution of the company projects.</li><li>There have been certain instances of delays in payment of statutory dues by the Company in the past. Any delay in payment of statutory dues by the Company in future, may result in the imposition of penalties and in turn may have an adverse effect on the Company's business, financial condition, results of operation and cash flows.</li><li>The company rely on various third parties in the various activities for executing the company projects and factors affecting the performance of their obligations could adversely affect its projects.</li><li>The company heavily dependent on government bodies for receipt of orders. Majority of its revenue is generated from business transactions with government entities or agencies. Any change in the governments in the markets in which we operate, change in policies and/or its inability to recover payments therefrom in a timely manner or at all, would adversely affect our operations and revenues which in turn would adversely affect its profitability.</li><li>The company projects are awarded through the competitive bidding process by government authorities/bodies. Its may not be able to qualify for, compete and win future projects, which could adversely affect the company business and results of operations.</li><li>The company experienced negative cash flows in the past and may continue to do so in the future and the same may adversely affect its cash flow requirements, which in turn may adversely affect the company ability to operate its business and implement the company growth plans, thereby affecting the company financial condition.</li><li>The company deploy traditional technologies in the designing and installation of its projects. Any incapability to adopt a new technology or change in the requirement of a particular technology by the government authorities may affect the company position to bid for future projects.</li><li>The company business is subject to seasonal variation and its may not able to accurately forecast the company project schedule which could have an adverse effect on the company cash flows, business, results of operations and financial condition.</li><li>The trademarks being used by it for the company business are not registered and its inability to obtain this registration may adversely affect the competitive business position. the company inability to protect or its our intellectual property rights may adversely affect its business.</li><li>Most agreements that the company has entered into in connection with its business, contain a penalty or liquidated damage clause for delay in the completion of a project. Such clauses take effect should the completion of a project be delayed for the reasons which are attributable to it.</li><li>The company's dependent on limited number of suppliers and contractors for supply of key raw materials and manpower. the company has not made any long term supply arrangement with the company suppliers. In an eventuality where its suppliers and contractors are unable to deliver it the required resources in a time-bound manner it may have a material adverse effect on the company business operations and profitability.</li><li>If the Company fails to capitalize on government policy initiatives in the water supply and wastewater treatment market, it will affect the company business model, profit margins & marketability </li><li>The company rely on consortium partners to bid on selective government projects and execution of awarded projects for it. The failure of such consortium partner to perform its obligations could imposeadditional financial and performance obligations which may result in reduced profits or, in some cases, significant losses and may have an adverse effect on the company business, results of operations and financial condition.</li><li>Increase in the prices of construction materials and labour & works contract charges could have an adverse effect on the company business, results of operations and financial condition.</li><li>The company require certain approvals and licenses in the ordinary course of business and are required to comply with certain rules and regulations to operate its business, and the failure to obtain, retain and renew such approvals and licenses in a timely manner, or comply with such rules and regulations or at all may adversely affect the company operations.</li><li>There have been some instances of delay with respect to filing of certain forms with the Registrar of Companies in the past. the company cannot assure you that regulatory proceedings or actions will not be initiated against it, and the company will not be subject to any penalty imposed by the competent regulatory authority in this regard in the future which may impact the company financial condition and reputation.</li><li>The company actual cost in executing its projects may vary substantially from the assumptions underlying the company bid or estimates. its may be unable to recover all or some of the additional costs and expenses, which may have a material adverse effect on the company results of operations, cash flows and financial condition.</li><li>The Company is party to certain legal proceedings. Any adverse decision in such proceedings may have a material adverse effect on its business, results of operations and financial condition.</li><li>The company has certain contingent liabilities that have not been provided for in the company restated financial statements, which if realised, could adversely affect the company financial condition.</li><li>The completion of the company projects can be delayed on account of its dependency on the company contracted labour force. Also, its results of operations could be adversely affected by strikes, work stoppages or increased wage demands by the company employees or other disputes with its employees or the company contractors' employees.</li><li>The company required to furnish bank guarantees as part of its business. the company inability to arrange such guarantees or the invocation of such guarantees may adversely affect the company cash flows and financial condition.</li><li>The company contracts with government authorities/bodies usually contain terms that favour them, who may terminate its contracts prematurely under various circumstances beyond the company control and as such, the company has limited ability to negotiate terms of these contracts and may have to accept restrictive or onerous provisions. its inability to negotiate terms that are favourable to it may have a material adverse impact on the company financial condition and results of operations.</li><li>The company has entered, and will continue to enter, into related party transactions which may involve conflicts of interest.</li><li>The company trades receivables collection cycle is relatively long, which exposes it to higher client credit risk and seasonality in the company results.</li><li>Trade Receivables and Inventories form a substantial part of the company current assets and net worth. Failure to manage the same could have an adverse effect on its net sales, profitability, cash flow and liquidity.</li><li>An inability to comply with repayment and other covenants in the financing agreements or otherwise meet the company debt servicing obligations could adversely affect its business, financial condition, cash flows and credit rating. Further, the company's subject to risks arising from interest rate fluctuations, which could reduce the profitability of its projects and adversely affect the company business, financial condition and results of operations.</li><li>The company operate in the construction industry where there are low entry barriers and is highly competitive. its failure to successfully compete may adversely affect the company business, financial condition, results of operations and prospects.</li><li>The company may be subject to liability claims or claims for damages or termination of contracts for failure to meet project completion timelines or defective work, which may adversely impact on the company profitability, cash flows, results of operations and reputation.</li><li>The company failure to accurately forecast and manage inventory could result in an unexpected shortfall and/ or surplus of raw materials, equipment and manpower, which could affect its business and financial condition.</li><li>The company business is substantially dependent on its design and engineering teams to accurately carryout the pre-bidding engineering studies for potential projects. Any deviation during the execution of the project as compared to the company pre-bid estimates could have a material adverse effect on its cashflows, results of operations and financial condition.</li><li>The company operations may be adversely affected in case of industrial accidents at its construction sites</li><li>Any variation in the utilisation of the Net Proceeds would be subject to certain compliance requirements, including prior shareholders' approval.</li><li>Its inability to respond adequately to increased competition in the company business may adversely affect its business, financial condition and results of operations.</li><li>Any inability to maintain the company equipment assets or manage its employees or inadequate workloads may cause underutilization of the company workforce and equipment, and such underutilization could reduce its ability to efficiently utilize the company assets which may have an impact on the company profitability.</li><li>Certain sections of this Red Herring Prospectus disclose information from the industry report which has been commissioned and paid for by it exclusively in connection with the Issue and any reliance on such information for making an investment decision in the Issue is subject to inherent risks.</li><li>If the company fail to undertake Operation & Maintenance (O&M) works, or if there is any deficiency of service regarding these works in the projects installed by it pursuant to and as per the relevant contractual requirements, its may be subject to penalties or even termination of the company contracts, which may have a material adverse effect on its reputation, business, financial condition, results of operations and cash flows.</li><li>Water treatment or reuse and Zero Liquid Discharge technology is subject to rapid change. These changes may affect the demand for its services. If the company unable to keep abreast of the technological changes and new introductions the company business, results of operations and financial condition may be adversely affected.</li><li>The company Promoters and certain of its Directors may be interested in the company Company other than remuneration and reimbursement of expenses.</li><li>The Company has availed ? 11.29 lakhs as unsecured loan which are repayable on demand. Any demand from the lenders for repayment of such unsecured loan may affect its cash flow and financial condition.</li><li>The company Promoters have mortgaged their personal properties and provided personal guarantees for its borrowings to secure the company loans. its business, financial condition, results of operations, cash flows and prospects may be adversely affected by the revocation of all or any of the personal guarantees provided by its Promoters and members of Promoter Groups in connection with the Company's borrowings.</li><li>Insurance coverage may not adequately protect it against all losses due to mishaps or accidents including damage or loss to life and property or the insurance cover may not be available for all the losses as per the insurance policy, which could adversely affect business, results of operations and financial condition.</li><li>The company employees may engage in misconduct or other improper activities, including non-compliance with regulatory standards and requirements and the same may results into imposition of criminal penalties, fines, revocation of regulatory approvals and harm to the company reputation, any of which could form a material adverse effect on its business.</li><li>Some of the company Directors does not have experience of being a director of a public listed company.</li><li>The company funding requirements and the proposed deployment of Net Proceeds are not appraised by anyindependent agency and are based on management estimates which may be subject to change basedon various factors, some of which are beyond its control. Further, deployment of funds raised through this Issue shall not be subject to monitoring by any monitoring agency.</li><li>The company has issued the following shares in the last one year prior to the date of this Red Herring Prospectus, which may be at a price lower than the Issue Price.</li><li>The average cost of acquisition of Equity Shares by the company Promoters could be lower than the floor price.</li><li>The company has presented certain supplemental information of its performance and liquidity which is not prepared under or required under Indian GAAP</li></ul>

The Issue type of Sattva Engineering Construction Ltd is Book Building - SME.

The minimum application for shares of Sattva Engineering Construction Ltd is 3200.

The total shares issue of Sattva Engineering Construction Ltd is 4716800.

Initial public issue of upto 47,16,800 equity shares of face value of Rs.10/- each of sattva engineering construction limited (formerly known as Sattva Engineering Construction Private Limited), ("Sattva" or the "Company" or the "Issuer") for cash at a price of Rs.75/- per equity share including a share premium of Rs.65/- per equity share (the "issue price") aggregating to Rs.35.38 crores ("the issue"), of which 2,40,000 equity shares of face value of Rs.10/- each for cash at a price of Rs.75/- per equity share including a share premium of Rs.65/- per equity share aggregating to Rs.1.80 crores will be reserved for subscription by market maker to the issue (the "market maker reservation portion"). The issue less the market maker reservation portion i.e. net issue of 44,76,800 equity shares of face value of Rs.10/- each at a price of Rs. 75/- per equity share including a share premium of Rs. 65/- per equity share aggregating to Rs. 33.58 crores is hereinafter referred to as the "Net Issue". The issue and the net issue will constitute 27.00% and 25.63%, respectively, of the post issue paid up equity share capital of the company.