Target: ₹1,970
CMP: ₹1,498.75
VA Tech Wabag has secured new orders totalling over ₹2,781 crore this quarter, increasing its total order book to around ₹14,200 crore (including framework contracts). It also recently won a consortium order worth ₹3,251 crore ($371 million) for the Al Haer Independent Sewage Treatment Plant in Riyadh, Saudi Arabia. With this, the company is now likely to surpass the order book target of over ₹16,000 crore by the end of this fiscal year.
The management anticipates strong revenue growth driven by India and MEA, projecting a CAGR of 15-20 per cent over the next 3-5 years. EBITDA/PAT growth is expected to outpace revenue growth, with EBITDA margins ranging between 13-15 per cent and potentially exceeding the upper end of this guidance.
The company has now been net cash positive for the eighth consecutive quarter, with a net cash position of ₹263 crore as of Q3FY25. It continues to focus on reducing working capital requirements and expects further improvement in the coming quarter.
The targeted revenue mix, which includes over 50 per cent from international projects, 30 per cent from industrial customers, 20 per cent from O&M, and one-third of EPC being EP projects, is expected to contribute to margin improvement.
