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The shares of the world’s leading water treatment firm rose by 3% to ₹1,352.20 each on Tuesday after the board approved the sale of its 100% stake in Wabag Romania for a valuation of EUR 1,200,000. 

On Tuesday at 10:55 a.m., the shares of VA Tech Wabag Ltd were quoted at ₹1,325.25 per share, up by 0.87% on the National Stock Exchange. The company has a market capitalization of ₹8,234 crores. 

What News:

The Board of Directors of VA Tech Wabag Limited approved the sale of a 100% stake in Wabag Water Services S.R.L., Romania (“Wabag Romania”) for EUR 1,200,000 at their meeting on Monday, July 8, 2024. 

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Wabag Romania is a wholly-owned subsidiary of VA Tech Wabag GmbH, Austria (“Wabag Austria”), which in turn is a step-down subsidiary of the Company. 

In FY 2023-24, Wabag Romania contributed INR 480.20 million, or 1.68%, to the Company’s turnover and INR 801.84 million, or 4.40%, to the Company’s net worth. 

About the company:

Va Tech Wabag Ltd is engaged in the business of water treatment field. Its principal activities include the design, supply, installation, construction, and operational management of drinking water, wastewater treatment, industrial water treatment, and desalination plants. 

Va Tech Wabag Ltd designs, installs, and manages water treatment plants worldwide. The company is establishing 100 Bio-CNG plants to utilize sewage treatment potential for Bio-CNG production, aiming to reduce fossil fuel consumption and greenhouse gas emissions in transportation and industry. 

As of Q1 FY24, the company’s order book is approximately ₹12,500 crores, with 58% from EPC projects and 42% from O&M projects. Municipal projects account for 83% of the orders, while industrial projects make up the remaining 17%. India contributes to 69% of the order book, with the rest of the world (ROW) accounting for 31%. 

By March 2023, the company had executed 6,500 projects across more than 25 countries, serving the Indian sub-continent, Middle East & Africa. 

Financials:

Va Tech Wabag Ltd experienced a 3.5% year-on-year decrease in operational revenue, falling from ₹2,960 crores in FY22-23 to ₹2,856 crores in FY23-24. However, net profit surged by 2172%, soaring from ₹11 crores to ₹250 crores. 

Furthermore, the Va Tech Wabag shares have appreciated by 110% over the last six months and 168% over the past 12 months. 

Written by Omkar Chitnis 

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