Target: ₹1,950
CMP: ₹1,510.65
VA Tech Wabag is a leading Indian multinational focused exclusively on water technology, delivering solutions in municipal and industrial water treatment, including desalination, wastewater treatment, and water reuse.
FY25 marked a milestone year for VA Tech Wabag, with the company delivering its highest-ever order book, revenue, EBITDA, and PAT. Strong financial discipline led to ₹705 crore in net cash, ₹353 crore in free cash flow, 13% EBITDA margin, 9% PAT margin, and 15% return on equity. Its upgraded AA credit rating reflects the company’s robust execution and low-risk, cash-rich profile.
With an order book of ₹13,667 crore, which is 4.2 times its FY25 revenue, Wabag has strong visibility over the next 3–4 years, especially as it taps into India’s ₹35,800 crore water infrastructure opportunity. The company is also nurturing future growth through its Blue Seed Initiative, which supports innovation in water-tech by partnering with emerging startups. Company Outlook
We initiate a Buy rating on Va Tech Wabag with a target price of ₹1,950 based on 26.5x P/Ex assigned to its FY27E earnings.
Key risks include execution challenges in complex EPC projects, working capital pressures from delayed municipal payments, geopolitical uncertainties in international markets, margin sensitivity to project mix, and high dependence on government-funded orders.
Published on August 7, 2025
