One of many Jhunjunwala shares engaged within the design, building, operation, and upkeep of water remedy and desalination vegetation for municipal and industrial shoppers. The inventory has an upside potential of 52.72 % from its excessive, and ICICI Direct has given a purchase goal value of Rs. 2,308.
Inventory Worth Motion
With a market capitalization of Rs. 9,398.84 crores, the shares of Va Tech Wabag Restricted have been closed at Rs. 1511.30 per fairness share, down almost round 1.95 % from its earlier day’s shut value of Rs. 1541.40. The inventory is buying and selling beneath its 52-week excessive by 22.64 %.
Firm Overview
VA Tech Wabag Restricted was based in 1924 and is a 100-year-old multinational firm primarily based in Chennai, India. The corporate is a world chief in water and wastewater remedy options. The corporate focuses on designing, supplying, putting in, and managing vegetation for consuming water, wastewater remedy, and industrial water remedy.
With a presence throughout 4 continents, the corporate has executed over 6,500 tasks and holds greater than 125 mental property rights, showcasing its dedication to innovation.
Goal Worth
ICICI Direct has maintained a purchase score on the VA Tech Wabag Restricted and given a goal value of Rs. 2,308, which has an upside potential of 52.72 % from the closing value of Rs. 1511.30.
Rationale
VA Tech Wabag’s operational and monetary efficiency is predicted to enhance considerably, with estimated income, EBITDA, and PAT development at 7.4%, 21.9%, and 24.9% CAGR from FY24-27E. With a give attention to return ratios and an asset-light mannequin, the corporate is valued at Rs. 2,308, or 30x FY27E EPS.
Order Guide
VA Tech Wabag has seen a robust order influx of over Rs. 4,600 crores in H1 FY25, with 57% from worldwide shoppers and 31% from the commercial sector. The corporate’s order e book stands at over Rs. 14,500 crore, and it anticipates reaching Rs. 16,000 crore by the top of FY25, pushed largely by worldwide markets.
The corporate has already secured most well-liked bidder standing in tasks value Rs. 3,500 crores, anticipated to transform quickly. The corporate is on observe to surpass its FY25 order consumption steering, aiming for Rs. 8,000 crores in complete inflows, with a continued give attention to E&P tasks and worldwide development.
Within the newest developments, the corporate introduced that the Kingdom of Saudi Arabia canceled an order positioned on sixth September, valued at roughly $317 million (~Rs. 2,700 crores). The order was for the EPCC of a 300 MLD Mega SWRO desalination plant in Yanbu.
Tasks
VA Tech Wabag’s key tasks embrace the 400 MLD Perur desalination plant in Chennai, progressing nicely with peak engineering and civil works, and the 200 MLD sewage remedy plant in Pagla, Bangladesh, which has resumed after a two-month disruption.
Moreover, the Kolkata HAM mission has efficiently achieved its Industrial Operation Date (COD), marking a major milestone within the firm’s mission portfolio.
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Key orders obtained in H1FY25
In H1 FY25, the corporate entered the photo voltaic PV sector with a Rs. 1,000 crore contract for a 100 MLD desalination mission from Indosol Photo voltaic, together with 15 years of O&M. Different notable orders embrace repeat enterprise from the Nemmeli Chennai plant and a Rs. 300 crore contract from Reliance Industries.
Shareholding Sample
In September 2024, Va Tech Wabag Restricted had a majority stake held by the promoters at 19.12 %, international institutional traders at 14.68 %, home institutional traders at 3.59 %, and the general public at 62.59 %. Within the public holding, Rekha Rakesh Jhunjunwala holds an 8.04% stake in Va Tech Wabag Restricted.
Current quarter outcomes and ratios
Va Tech Wabag Restricted’s income has elevated from Rs. 665 crore in Q2 FY24 to Rs. 700 crore in Q2 FY25, which has grown by 5.26 %. The web revenue of Va Tech Wabag Restricted has additionally grown by 16.67 %, from Rs. 60 crore in Q2 FY24 to Rs. 70 crore in Q2 FY25.
Va Tech Wabag Restricted’s income and internet revenue have grown at a CAGR of two.80 % and 31.35 %, respectively, over the past 4 years.
When it comes to return ratios, the corporate’s ROCE and ROE needs to be 19.8 % and 13.8 %, respectively. The debt-to-equity ratio of the corporate is to be 0.22x, which reveals the corporate is sort of debt-free. Va Tech Wabag Restricted’s EPS is to be Rs. 42.
Written By – Nikhil Naik
Disclaimer
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