Latest news with #Wriddhi
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Business Standard
20 hours ago
- Business
- Business Standard
VA Tech share up 3% as MOFSL initiates coverage with 'Buy'; 25% upside eyed
VA Tech Wabag share price today: Shares of desalination and water treatment company VA Tech Wabag rose nearly 3 per cent to hit an intraday high of ₹1,559.9 on Tuesday, June 22, 2025, on the NSE after brokerage firm Motilal Oswal Financial Services (MOFSL) initiated coverage on the stock with a bullish outlook, driven by a robust growth outlook, strong order book and improving margins. The brokerage initiated coverage of VA Tech Wabag with a 'Buy' rating and a target price of ₹1,900 per share, implying a 25 per cent upside from Monday's closing levels of ₹1517.8. "We initiate coverage on VATW with a Buy rating and a target price of ₹1,900, based on 26x FY27E P/E (premium to historical average of 18x on improved outlook). We believe large order inflows and a significant margin expansion could fuel valuation re-rating in the near to medium term," the brokerage said in a note dated July 22. At 11:45 AM, the stock was trading at ₹1,544, up 1.73 per cent from its previous day's close. In comparison, the benchmark NSE Nifty50 was trading lower by 28 points or 0.11 per cent at 25,062.7 levels. Here are the key reasons why MOFSL is bullish on VA Tech Wabag: Water management - A multi-decadal theme According to analysts at Motilal Oswal, the global water and waste management market is estimated to reach $576 billion by 2032, from $329 billion in 2023 at a CAGR of 6 per cent. The key factors driving the growth include rising water pollution, increasing environmental compliance, water scarcity, and demand for wastewater services from industries. In addition, the large projects are backed by central governments, sovereign funds and multi-lateral agencies to support companies to execute with payment security, the brokerage said. VA Tech Wabag - A global leader in water technology With over 100 years of experience, VA Tech Wabag is the world's third-largest private water operator. The company has a presence in more than 25 countries in all major segments of water treatment, including drinking water, sewage, industrial, seawater desalination, and water recycling. With technical expertise and vast experience in executing large critical projects, MOFSL believes VA Tech Wabag is now qualified to independently bid for marquee projects globally. However, it is selective in bidding, with a focus on margins and cash flows, and has a win ratio of 25 per cent to 30 per cent. Solid growth strategy In 2023, the company launched a long-term comprehensive plan, 'Wriddhi', in response to the ever-evolving and complex global water treatment market. In the next 3-5 years, VATW's is expected to achieve and order book 3x of revenue, revenue CAGR of 15-20 per cent, Ebitda margin of 13-15 per cent, RoCE of more than 20 per cent, O&M mix at 20 per cent, RoE of over 15 per cent, and net-cash positive. Net cash company with healthy return ratios According to MOFSL, VA Tech Wabag has witnessed a turnaround in its free-cash flow (FCF) generation in the last five years, achieving a net-cash balance of ₹5.9 billion as of FY25 from net debt of ₹4 billion in FY19. The company's return on capital employed (RoCE) has almost doubled to 20 per cent in FY25 from 11 per cent in FY19. Return on invested capital (ROIC) has also increased to 28 per cent in FY25 from 12 per cent in FY19. The brokerage expects strong FCF generation (₹3.5 billion annually over FY25-28E) to sustain on the back of healthy operating performance and improvement in working capital cycle. It also expects further expansion in RoCE to 24 per cent, RoE to 16 per cent, and RoIC to 39 per cent, during the same period.
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Business Standard
22-05-2025
- Business
- Business Standard
VA Tech Wabag share rallies 10% on healthy Q4 nos; check key details here
VA Tech share price: VA Tech Wabag (VA Tech) shares were in demand on Thursday, May 22, 2025, with the stock rallying up to 9.93 per cent to hit an intraday high of ₹1,549.65 per share. What is the reason behind this rally? VA Tech share price surged after the company reported strong results in the March quarter of financial year 2025 (Q4FY25). The company's consolidated revenue from operations surged 15 per cent Y-o-Y to ₹3,294 crore, while its profit after tax (PAT) rose 20 per cent annually to ₹295.3 crore. The consolidated Ebitda stood at ₹430.2 crore. In standalone terms, revenue from operations rose 15 per cent Y-o-Y to ₹2,873.8 crore, while PAT zoomed 15 per cent Y-o-Y to ₹2,71.3 crore. The standalone Ebitda was ₹402.9 crore. The company's order book position is at ₹13,700 crore including framework contracts, which is providing robust revenue visibility. Also Read "We are pleased to close another year of strong and profitable growth, driven by our long-term strategy, Wriddhi This success reflects our disciplined execution, customer-centric approach, and commitment to delivering sustainable water solutions across global markets. We are especially proud to have been recognised by Global Water Intelligence as one of the top three global desalination players—a testament to our leadership and the trust placed in us by our clients and partners. Our financial resilience was further reinforced by the upgrade of our long-term credit rating to AA- with a stable outlook, affirming the strength of our balance sheet and prudent financial management,' said Rajiv Mittal, chairman & managing director, VA Tech Wabag. 'With a robust order book of ₹137 crore and a balanced EPC and O&M portfolio, we have strong revenue visibility and stable cash flows. FY25 also marks our fifth consecutive year of ending net cash positive, highlighting our operational strength and financial discipline. In recognition of this performance, and to commemorate WABAG's centenary, the Board has recommended a dividend of ₹4 per share, subject to shareholder approval As we look ahead, we remain focused on creating long-term value through innovation, sustainable infrastructure, and strategic partnerships that contribute to a water-secure future," Mittal added. VA Tech dividend VA Tech Board of Directors have recommended a final dividend of ₹4 per equity share of face value ₹2 each (200 per cent) for FY25 'The said dividend recommended to the Members of the Company, shall be subject to the approval of the Members at the ensuing 30th Annual General Meeting (AGM) of the Company,' VA Tech said. ALSO READ | Smallcap stock hits record high in weak market; rallies 69% thus far in May About VA Tech VA Tech is a leading Indian multinational specialising in total water management solutions. The company offers end-to-end services including design, supply, installation, construction, and operation of water and wastewater treatment plants. Wabag's expertise spans across drinking water, municipal and industrial wastewater, industrial process water, and desalination systems. In addition to technical solutions, WABAG also delivers projects under BOOT (Build-Own-Operate-Transfer) and EPC (Engineering, Procurement, and Construction) models, making it a full-spectrum player in the water infrastructure space. With a strong focus on sustainability and innovation, WABAG has established a major global footprint, operating in key regions such as India, South East Asia, the Middle East, Africa, Europe, and Latin America.
