ABOUT THE COMPANY
VA TECH WABAG LIMITED is an industry leader in the business of water & wastewater treatment. The company offers solutions for drinking water treatment, industrial water & wastewater treatment across municipal and industrial segments. The company is ranked in the third largest private water operator in the world and among the Top 5 Global Desalination players by Global Water Intelligence, UK. Key clientele of the company includes Uttar Pradesh Jal Nigam, Dhaka Wasa, Delhi Jal Board, CIDCO, etc. across the municipal segment and ONGC, Reliance, Indian Oil, Pepsico, etc. across the industrial segment. The company business model focuses on low capex, asset light model through a partnership with financial, Construction and Technology partners. Management of the company expects a CAGR of 15-20% over FY 27-FY29. Company’s order book stands above ₹14,200 crore and management aiming it to be ₹16,000 crore showing strong revenue visibility of around 4x its trailing twelve-month revenues.
Quick peer context: Its closest peers include Ion Exchange (India) Ltd and Thermax Ltd. Ion Exchange (India) Ltd focuses on water treatment chemicals, resins, etc. and has an annual revenue of ₹2,400–2,600 crore whereas Thermax Ltd is a much large, diversified player with FY25 revenue of ₹10,000 crore. Its water treatment segment only forms part of its revenue, but it benefits from a strong balance sheet and larger institutional clients.
Analysis of the Financial Statements
Revenue Growth Trend
The company has shown steady growth over the past 5 years, compounding at about 5.20%, from being Rs 2,557 crores in March 2020 to Rs 3,294 crores in March 2025. The revenue split for FY25 shows that 83% comes from EPC, and 17% from O&M. The management is focused on improving the O&M business to reach the target of 20% of the total revenue. Its growing order book shows assures of the high revenue soon.
| March 2020 | March 2021 | March 2022 | March 2023 | March 2024 | March 2025 |
| 2,557 CRORES | 2,834 CRORES | 2,979 CRORES | 2,960 CRORES | 2,856 CRORES | 3,294 CRORES |
Profitability & Margin Analysis
Operating Profit Margin of the company has shown a steady increase from 8% to 13% in the past 5 years, which shows that the company management has taken steps to reduce the costs and improve the net profit percentage. While Ion Exchange (India) Ltd operates at a generally lower margin of 9-11% and Thermax Ltd, being a diversified engineering company operates at a consolidated operating profit margin of 11-14%.
| March 2020 | March 2021 | March 2022 | March 2023 | March 2024 | March 2025 |
| 8% | 8% | 8% | 11% | 13% | 13% |
Balance Sheet Strength
Total Assets of the company have shown an increase from Rs 4,022 crores to Rs 5,267 crores. Being an asset light business company growth can be determined by the investment in the assets but its expenditure on the R&D can help to determine prospects. Company has R&D facilities in India and Europe. The company is technology-focused and owns 125+ IP rights.
| March 2020 | March 2021 | March 2022 | March 2023 | March 2024 | March 2025 |
| 4,022 CRORES | 4,157 CRORES | 3,999 CRORES | 4,088 CRORES | 4,574 CRORES | 5,267 CRORES |
Debt Profile
Company has reduced its debt significantly in the past 5 years from being RS 520 crores in March 2020 to Rs 362 crores in March 2025. Reserves and surplus nearly doubled during the past 5 years standing at Rs 2,128 crores as of March 2025 indicating fuel for self-growth without any external help.
Reserves and Surplus:
| March 2020 | March 2021 | March 2022 | March 2023 | March 2024 | March 2025 |
| 1,164 CRORES | 1,397 CRORES | 1,527 CRORES | 1,562 CRORES | 1,806 CRORES | 2,128 CRORES |
Cash Flow Health
The Cash from Operating Activity has remained positive throughout the years and been growing at a steady phase, a very constructive sign for a company in investment phase. The cash conversion cycle of the company is 223 days, which can be accepted for such industry. The cash generated and the cash conversion cycle is a critical indicator of a healthy business model that generates real cash from its core activities.
Comparative Data with Key Competitors (Larsen & Toubro, Honeywell Automation India)
| Parameter | Va Tech Wabag Ltd | Ion Exchange (India) Ltd | Thermax Ltd |
| Sales Growth (5-Yr CAGR) | 5% | 13% | 13% |
| Operating Profit Margin | 13% (Stable & improving) | 11% (Consistent) | 9% (Improving from 7%) |
| Debt-to-Equity | 0.17 (Low) | 0.27 (Low) | 0.35 (Moderate) |
| Reserves Growth | Consistently Strong (9% CAGR) | Strong (28% CAGR) | Strong (10% CAGR) |
| Cash Flow | Consistently Positive CFO | Positive, but variable | Consistently Positive |
Disclaimer: The article is for informational purposes only and not investment advice.