Va Tech Wabag shares climb 5% on fresh order win; what consensus target hints at

Shares of Va Tech Wabag Ltd climbed 5 per cent in Monday's trade after the pure-play multinational water technology firm bagged a large order from the Bangalore Water Supply and Sewerage Board (BWSSB) for designing, building and operating 100 MLD and 60 MLD sewage treatment plants at Byramangala and Bellandur respectively, along with a 25 MLD tertiary treatment plant at Byramangala. For VA Tech Wabag, a large order refers to a contract valued between Rs 250 crore and Rs 600 crore.

In a filing to stock exchanges, Va Tech Wabag said the scope includes the design, engineering, procurement, construction and commissioning of the wastewater treatment facilities along with biogas-based power generation. The sewage treatment plants will be based on the Activated Sludge Process integrated with a Biological Nutrient Removal system, Va Tech Wabag said adding that the tertiary treatment plant will utilise Ultrafiltration to produce high-quality treated water suitable for distribution to surrounding water bodies. 

Following the development, Va Tech Wabag shares rose 4.95 per cent to hit a high of Rs 2,089 apiece. With this, the stock has cut its one-week losses to 5.20 per cent. The consensus target on the stock based on 11 recommedations suggests nil upside potential on the counter, Bloomberg data suggested. Among recent targets, Systematix on July 15 reiterated its 'Buy' rating on the stock with a target price of Rs 2,075. MOFSL maintained its 'Buy' rating and set a target of Rs 2,529 earlier this month. Yes Securities, in its June 29 note, pegged the stock at Rs 2,090.

"It is worth noting that, WABAG had previously executed the first phase of the Bellandur facility and has now been awarded the second phase as well. The EPC scope of the facilities is scheduled for completion within 36 months, followed by a 7-year Operations and Maintenance (‘O&M’) period, during which WABAG will ensure efficient and reliable plant performance," the company informed BSE.

Va Tech Wabag said the Wastewater Treatment facilities at Byramangala and Bellandur will significantly strengthen Bengaluru's wastewater treatment and water infrastructure, addressing the city's growing challenges arising from rapid urbanization. 

The facility, it said, will incorporate anaerobic sludge digestion with biogas-based captive power generation, reducing greenhouse gas (‘GHG’) emissions, lowering the plant's energy footprint, enhancing operational efficiency, and promoting resource recovery. 

"By integrating the treatment technologies with renewable energy generation, the project will support Bengaluru's longterm water security while advancing its sustainability and circular economy objectives," it said.

Vice President & Head for Sales and Marketing, S Natrajan, said: “Securing these twin wins from BWSSB reinforces WABAG's leadership in India's municipal wastewater treatment sector and underscores its commitment to delivering sustainable, resilient, and future-ready water infrastructure."

Natrajan said the energy-efficient wastewater treatment facilities, integrated with biogas-based power generation, will establish a scalable model for resource recovery, circularity, and energy optimization while significantly enhancing Bengaluru's sewage treatment capacity, promoting environmentally responsible wastewater management, supporting Karnataka's water security objectives, and strengthening the long-term sustainability and resilience of the city's water ecosystem.