Steamhouse India has secured a ₹311 crore engineering and construction mandate for a steam plant at the Himachal Pradesh Bulk Drug Park. The project includes a 25-year operation and maintenance agreement. While the company's asset-light model helps manage capital spending, investors should track project execution timelines and the long-term occupancy success of the drug park.
Steamhouse India has been awarded a ₹311 crore contract for engineering, procurement, and construction (EPC) work at the Bulk Drug Park in Una, Himachal Pradesh. The project involves building a 300 tonnes per hour (TPH) steam and co-generation plant, along with an integrated steam distribution network.
The company operates on a community boiler model. For this project, the capital costs are being funded by Himachal Pradesh Bulk Drug Park Infrastructure Ltd. This is a key investor detail as it allows Steamhouse India to maintain an asset-light model, meaning the company does not have to spend its own capital to build the heavy machinery or infrastructure. This structure helps keep debt levels lower compared to a traditional ownership model where the company would fund the construction itself.
Beyond the initial construction, the deal includes a 25-year operation and maintenance agreement, which is intended to provide long-term income. The project structure includes a revenue-sharing model that is currently slated to begin in April 2032, following an initial phase of operations.
This contract is a significant addition to the company's operational footprint. Steamhouse India currently has 345 TPH of existing capacity, with another 360 TPH under construction. Adding this new 300 TPH facility will bring the company's total potential capacity to approximately 1,005 TPH once the project is completed.
While the asset-light approach helps mitigate capital spending, there are specific risks for investors to keep in mind. The construction period is expected to last 24 months, and the project is still subject to final agreements and regulatory clearances. Furthermore, because the business relies on providing steam to pharmaceutical manufacturers within the industrial cluster, the company's revenue potential is tied to the success of the Bulk Drug Park itself. If the pharmaceutical companies take longer to set up, or if demand for steam is lower than expected, it could impact the revenue visibility for this facility.
The next steps for investors to monitor include the progress of the 24-month construction timeline and the status of necessary regulatory approvals. Management commentary regarding project milestones and any future updates on the revenue-sharing framework will be important to track as the project moves toward commissioning.