VA Tech Wabag Q1 profit beats estimates; Axis Securities retains ‘Buy’ call with 23% upside potential
The domestic brokerage has maintained its Buy rating on the water treatment solutions provider, with a target price of Rs 1,920, implying a 22.90 per cent upside from Thursday’s day high level of Rs 1,562.30.
- Aug 14, 2025,
- Updated Aug 14, 2025 11:58 AM IST
VA Tech Wabag Ltd reported strong June quarter (Q1 FY26) earnings, with profit and operating performance beating market expectations, according to Axis Securities. The domestic brokerage has maintained its Buy rating on the water treatment solutions provider, with a target price of Rs 1,920, implying a 22.90 per cent upside from Thursday’s day high level of Rs 1,562.30.
The company’s consolidated revenue rose 17 per cent year-on-year (YoY) to Rs 734 crore, in line with estimates, while EBITDA grew 18 per cent YoY to Rs 96 crore -- per cent higher than projected.
Net profit climbed 20 per cent YoY to Rs 66 crore, surpassing the forecast of Rs 60 crore. Gross margins improved to 28.7 per cent from 26.6 per cent a year ago, aided by better execution and a favourable project mix.
VA Tech secured fresh orders worth about Rs 2,600 crore during the quarter, taking its order book to a robust Rs 15,800 crore -- more than four times its annual revenue.
Key wins included the Rs 2,038 crore Yanbu 300 MLD desalination project in Saudi Arabia and a Rs 380 crore sewage treatment plant project for BWSSB in Bengaluru. The company remains the preferred bidder for projects worth Rs 3,500 crore.
Axis Securities noted that the company is targeting revenue growth of 15–20 per cent CAGR over the next three to five years, supported by healthy margins in the 13–15 per cent range.
The firm aims to maintain an order book at over three times its annual revenue, with more than half of its business from overseas markets.
The brokerage believes the company’s strong balance sheet, net cash position of Rs 627 crore, and diversified order book across geographies and client segments position it well to capitalise on rising global and domestic demand for water infrastructure.
VA Tech Wabag Ltd reported strong June quarter (Q1 FY26) earnings, with profit and operating performance beating market expectations, according to Axis Securities. The domestic brokerage has maintained its Buy rating on the water treatment solutions provider, with a target price of Rs 1,920, implying a 22.90 per cent upside from Thursday’s day high level of Rs 1,562.30.
The company’s consolidated revenue rose 17 per cent year-on-year (YoY) to Rs 734 crore, in line with estimates, while EBITDA grew 18 per cent YoY to Rs 96 crore -- per cent higher than projected.
Net profit climbed 20 per cent YoY to Rs 66 crore, surpassing the forecast of Rs 60 crore. Gross margins improved to 28.7 per cent from 26.6 per cent a year ago, aided by better execution and a favourable project mix.
VA Tech secured fresh orders worth about Rs 2,600 crore during the quarter, taking its order book to a robust Rs 15,800 crore -- more than four times its annual revenue.
Key wins included the Rs 2,038 crore Yanbu 300 MLD desalination project in Saudi Arabia and a Rs 380 crore sewage treatment plant project for BWSSB in Bengaluru. The company remains the preferred bidder for projects worth Rs 3,500 crore.
Axis Securities noted that the company is targeting revenue growth of 15–20 per cent CAGR over the next three to five years, supported by healthy margins in the 13–15 per cent range.
The firm aims to maintain an order book at over three times its annual revenue, with more than half of its business from overseas markets.
The brokerage believes the company’s strong balance sheet, net cash position of Rs 627 crore, and diversified order book across geographies and client segments position it well to capitalise on rising global and domestic demand for water infrastructure.