ROOTS: Era Infra Engineering Limited (EIEL)
Founded in 1990, Era Infra Engineering Limited (EIEL) has been a pioneering force in India’s infrastructure sector. Through its Engineering, Procurement, and Construction (EPC) division, the company has played a vital role in executing large-scale development projects across various sectors, solidifying its leadership in the industry.
Starting from humble beginnings, EIEL has successfully completed over 500 projects of varying scales in critical infrastructure areas, including roads, highways, power, railways, metro, aviation, and industrial infrastructure. The company was also listed on the Bombay Stock Exchange (BSE), the National Stock Exchange (NSE), and the Luxembourg Stock Exchange, which underscores its strong financial standing and credibility.
ROADBLOCK: Industry-Wide Challenges
In the last decade, the Indian construction industry has faced significant financial challenges, primarily due to high borrowing costs, project delays, and liquidity constraints. Infrastructure companies secured loans to finance various projects; however, delays in project execution—often caused by bureaucratic hurdles such as land acquisition, environmental clearances, and pending approvals—disrupted cash flows and compounded the problems.
Public-Private Partnership (PPP) projects experienced substantial cost overruns and missed revenue forecasts, leaving private entities burdened with excessive debt. Consequently, the challenge of making interest payments became increasingly difficult, resulting in rising Non-Performing Assets (NPAs), and the long gestation periods of infrastructure projects further complicated repayment schedules. As a result, numerous construction and infrastructure companies faced financial distress, exacerbating the challenges within the sector.
RESILIENCE: Overcoming Challenges
EIEL encountered severe financial difficulties due to delays in project execution caused by external factors, as previously explained regarding the challenges faced industry-wide. These challenges significantly impacted EIEL's liquidity, leading to financial distress, substantial business losses, and missed opportunities. As a result, in 2018, EIEL was admitted under the Corporate Insolvency Resolution Process (CIRP), with a Resolution Professional appointed to manage its affairs. Despite this challenging period, EIEL's core strength, dedication, and value system enabled the company to complete and deliver several projects during the CIRP. Notable projects include Punjab Hoshiarpur National Highway, Punjab Dogankalan National Highway, DMRC Kashmere Gate to Lal Qila Metro Station, and Tunneling through TBM and NATM, Post Graduate Institute of Medical Sciences (PGIMS) Rohtak, Delhi Development Authority (DDA) Kalkaji, and NTPC Super Thermal Power Plant.
REVIVAL: A New Beginning
Despite the insolvency proceedings, EIEL displayed remarkable resilience and determination. Successfully navigating the complex National Company Law Tribunal (NCLT) process required patience, perseverance, and a strong belief in a positive resolution.
In June 2024, the National Company Law Tribunal (NCLT) approved EIEL’s resolution plan, marking a pivotal moment in the company’s journey. This milestone is not just about financial restructuring—it signifies a rebirth, reaffirming EIEL’s core values, dedicated workforce, and long-term commitment to excellence in infrastructure. EIEL is poised to reclaim its leadership position in the infrastructure sector. EIEL’s journey stands as a testament to strength, perseverance, and adaptability. While many companies struggle to recover from insolvency, EIEL has emerged revitalized, ready to set new industry benchmarks. With a renewed vision and financial stability, the company is well-positioned to contribute to India’s infrastructure growth.