Savy Infra IPO

Savy Infra and Logistics Limited, incorporated in January 2006, is an EPC (Engineering, Procurement, and Construction) company that specializes in foundational infrastructure services. Its core expertise includes large-scale earthwork and foundation preparation for road construction, embankments, sub-grade development, and surface paving. The company also offers demolition services, ensuring the safe dismantling of structures to make way for new developments. Additionally, Savy Infra rents out advanced machinery such as rock breakers and heavy excavators, supporting excavation and related services like shoring, strutting, side protection, slush removal, and material disposal.

Operating an asset-light business model, Savy Infra focuses on efficient service delivery by renting trucks and employing drivers to manage logistics and transportation. The company has successfully executed projects across multiple Indian states including Gujarat, Maharashtra, Andhra Pradesh, Telangana, Madhya Pradesh, Chhattisgarh, Karnataka, and Odisha. As of November 25, 2024, the company maintained a lean workforce of 33 full-time employees deployed across its operational sites.

Savy Infra IPO Strengths

• Savy Infra & Logistics operates as an EPC (Engineering, Procurement, and Construction) company, with expertise in earthwork and foundation preparation for large-scale infrastructure projects such as road construction, embankments, sub-grade preparation, and creating both granular sub-bases as well as bituminous or concrete surfaces.
• The logistics segment ensures direct, efficient, and reliable transport of large freight volumes from source to destination, minimizing material handling risks and reducing delivery times for clients.
• Besides infrastructure and road projects, Savy Infra & Logistics caters to the steel and mining industries, reducing exposure to any single sector and broadening its market opportunities.
• A strong operational focus on timely project delivery and efficient logistics enhances client trust and supports repeat business, strengthening the company’s competitive position.
• The company’s ability to offer end-to-end EPC and logistics solutions positions it to efficiently scale operations and take on larger, multi-faceted projects as demand increases.

Savy Infra IPO Risks

• The company reported very modest revenues until FY24, then jumped to significant scale in the last year. Such rapid expansion can strain resources, test internal controls, and heighten execution risks if growth is not managed carefully.
• The EPC and logistics sectors are highly competitive with many established players, potentially leading to price wars, pressure on margins, and challenges in securing long-term contracts.
• Savy Infra & Logistics is led by a small promoter group and core team. Business continuity, management capability, and strategic direction may suffer in the event of their exit or incapacity.
• The company employs just 33 full-time staff as of November 2024, which could be insufficient to support large or multiple simultaneous projects, risking quality and timely delivery.
• The company primarily serves the infrastructure, steel, and mining sectors, making it vulnerable to downcycles or regulatory changes impacting these sectors, as well as client dependency.
• The business is capital- and cash-intensive, particularly for EPC and logistics projects. Delays in payments from clients, cost overruns, or project delays can strain liquidity and affect operations.
• Key activities, including operations and transportation, may be performed by external vendors or contract labor, exposing the company to performance risks, labor disputes, and quality issues.