Sharekhan's research report on Va Tech Wabag
Q4FY2023 performance was good on the sales and OPM front, however provisioning of Rs. 243 crore impacted the bottom-line. Order intake has been strong in FY2023 at Rs. 6,844 crore, including Rs. 3,678 crore order of Chennai desalination plant. Executable order book stands at Rs. 12,055 crore and the company expects few more orders in the next 6-8 weeks. Va Tech continues to focus on high-quality, technologically advanced, and well-funded industrial as well as EP orders to improve margins and cash flows. The company also sees green hydrogen as a key long-term opportunity.
Outlook
We maintain Buy on Va Tech Wabag (Va Tech) with a revised PT of Rs. 520, considering strong order book, promising order pipeline, margin expansion, and improving working capital cycle.
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