The water supply and management sector in India is rapidly growing, driven by urgent water scarcity and government initiatives. The water and wastewater market was valued at Rs 192.44 billion in 2024 and is expected to reach Rs 353.50 billion by 2030, growing at a CAGR of 10.72 percent. Over 15.7 crore rural homes now have safe tap water under the Jal Jeevan Mission.
With a market capitalization of Rs 8,818.46 crore, the shares of VA Tech Wabag Ltd were trading at Rs 1,415.75 per share, increasing around 0.49 percent as compared to the previous closing price of Rs 1,408.90 apiece.
Brokerage Recommendation
Axis Direct has issued a ‘Buy’ rating on the water management company, setting a target price of Rs 1,930 per share, reflecting a 37 percent upside from the current Rs 1,408.90. The bullish outlook is driven by strong order inflows, robust execution, and expanding opportunities in global water infrastructure and sustainable project segments.
VA Tech Wabag reported a solid 19 percent YoY revenue growth in Q2FY26, aligning with expectations. Revenue remains second-half heavy, suggesting a stronger H2 performance. Management expects stable medium-term margins despite quarterly fluctuations, supported by a strong execution pipeline.
Furthermore, the company recorded fresh order inflows worth Rs 3,477 crore in H1FY26, taking the total order book to Rs 16,020 crore over 4x its FY25 revenue. Additionally, Wabag holds preferred bidder status for projects exceeding Rs 3,000 crore, reinforcing visibility for sustained growth ahead.
Additionally, Wabag is entering sunrise sectors through strategic wins like a CBG production project in Uttar Pradesh and water treatment orders for Renewsys Solar’s Hyderabad facility. These contracts expand its Future Energy Solutions vertical, unlocking significant long-term opportunities in renewable and sustainable technologies.
Future Outlook
VA Tech Wabag Ltd medium-term outlook projects strong growth, targeting a 15–20 percent revenue CAGR with an order book three times annual revenue. It aims for 13–15 percent EBITDA margins, over 20 percent RoCE, and 15 percent RoE supported by an asset-light model, 20 percent O&M contribution, and maintaining a net cash-positive position.
Financial & Operational Highlights
The company reported a strong Q2FY26 performance with revenue rising 19 percent year-on-year to Rs 834 crore and net profit up 21 percent to Rs 85 crore. The growth reflects robust demand, improved operational efficiency, and effective cost management, highlighting the company’s steady financial momentum and sustained profitability.
In H1FY26, the company generated total revenue of Rs 1,548.9 crore, with EPC contributing 81 percent and O&M 19 percent. The municipal segment dominated with Rs 1,195.3 crore, accounting for 77 percent of revenue, while the industrial segment added Rs 353.6 crore, or 23 percent, reflecting strong public infrastructure demand and steady private sector engagement.
Geographically, revenue distribution was balanced, with India contributing Rs 820.9 crore (53 percent) and overseas markets Rs 728.0 crore (47 percent). This near-equal split highlights the company’s strong global presence alongside robust domestic operations, supported by large-scale water infrastructure projects and expanding international contracts, driving sustained growth and diversification.
The company serves a diverse clientele across municipal and industrial sectors, including global names like Reliance, GAIL, IndianOil, and NMDC, alongside government water boards. Supported by leading funding agencies such as the World Bank, KfW, and Exim Bank, it operates in water, oil and gas, power, and industrial infrastructure segments worldwide.
The company ranks among the world’s top three private water operators and desalination plant suppliers, serving over 96 million people across 25 countries. With an order book of Rs 16,000 crore, 1,500+ plants executed with global R&D centers, and 125+ in-house innovations, it follows an asset-light model focused on sustainable water management and circular economy solutions.
VA Tech Wabag Ltd is a leading global water technology company headquartered in Chennai, specializing in water treatment, wastewater management, and desalination solutions. With operations across countries, it provides sustainable, innovative, and large-scale infrastructure services, helping industries and municipalities ensure efficient water use and environmental sustainability.
Written by Abhishek Singh
Disclaimer
The views and investment tips expressed by investment experts/broking houses/rating agencies on tradebrains.in are their own, and not that of the website or its management. Investing in equities poses a risk of financial losses. Investors must therefore exercise due caution while investing or trading in stocks. Trade Brains Technologies Private Limited or the author are not liable for any losses caused as a result of the decision based on this article. Please consult your investment advisor before investing.
