Kotak Securities is bullish on VA Tech Wabag has recommended buy rating on the stock with a target price of Rs 378 in its research report dated November 19, 2018.
Kotak Securities' research report on VA Tech Wabag
VA Tech (VAW) reported weak set of numbers which were lower than our estimates on revenue and profit front. EBITDA margin bore the brunt of lower revenues. On the positive side, order wins were strong in Q2FY19, thereby leading to much improved order book.
VAW is trading at 12x and 10x, FY19 and FY20 earnings respectively. In view of the long term growth potential in water and waste water treatment and reasonable valuations, we reiterate "BUY" with price target of Rs 378 (earlier Rs 476), valuing the stock at 13x FY20 earnings (earlier valued at 13xFY20E).
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