Nomura feels that the order inflow guidance of Rs 5,000-5,400 crore for FY20 should be met.
Shares of Va Tech Wabag added more than 2 percent in the early trade on August 20 after research house Nomura maintained a buy rating on the stock but cut target to Rs 445 per share from Rs 520 per share.
The research house cut FY20/21 EPS estimates by 23 percent / 22 percent to factor in slower execution.
According to Nomura, the recovery of stuck debtors by FY21 is a key trigger, while resumption in Namami Gange ordering post elections is a positive.
It feels that the order inflow guidance of Rs 5,000-5,400 crore for FY20 should be met, while FY20 revenue guidance of Rs 3,400-3,700 crore is at risk if execution in key projects gets delayed.
At 0928 hrs, Va Tech Wabag was quoting at Rs 291.10, up Rs 6.80, or 2.39 percent on the BSE.
The share touched its 52-week high of Rs 413.45 and its 52-week low of Rs 246.00 on 30 August 2018 and 10 December 2018, respectively.Currently, it is trading 29.59 percent below its 52-week high and 18.33 percent above its 52-week low.The Great Diwali Discount!
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