VA Tech Wabag: Record Orders and Expanding Global Footprint Drive Growth

$WABAG has achieved an all-time high order book of ₹19,400 crore, providing strong multi-year execution visibility. Additionally, the company is actively tracking a robust global opportunity pipeline worth $2–3 billion (₹20,000–25,000 crore). Q1 FY27 Performance: During Q1, operating income grew 20.8% YoY to ₹887 crore, driven by strong execution. Net profit surged 36.9% YoY to ₹90 crore, bolstered by a 360% surge in other income and a 12% drop in interest costs due to lower working capital reliance. Strong International Footprint: International markets generated 77% of Q1’s ₹3,400+ crore order intake and currently account for 52% of total revenue. Projects in the Middle East make up 35–40% of the order book, with management reporting minimal geopolitical disruption to ongoing essential water projects. Targeting Margin Recovery: EBITDA margins contracted to 8.96% in Q1 due to higher operating expenses. However, management maintains a medium-term EBITDA margin target of 13–15%, aiming for expansion by increasing the share of high-margin Engineering & Procurement (EP) projects to 10–20% of revenue. Improved Financial Health: Working capital efficiency has significantly improved, reducing from 130 days to around 100 days over the past three years. Steady growth in the predictable, asset-light Operations & Maintenance (O&M) segment further enhances earnings quality and cash conversion. Emerging Industrial Opportunities: The company aims to expand its industrial segment contribution from 12–13% to 20–25% by tapping into high-growth sectors, including data centres, semiconductors, green hydrogen, and solar energy water infrastructure over the next 3 to 7 years.