VA Tech Wabag share price

VA Tech Wabag Shares Surge 6.9% After Securing Major Orders from Reliance Industries

On Thursday, October 10, VA Tech Wabag’s share price skyrocketed by 6.9%, reaching an intraday high of Rs 1,534.65 per share on the Bombay Stock Exchange (BSE). This surge was fueled by the announcement of securing major water treatment orders from industry giant Reliance Industries (RIL). These contracts are specifically for water treatment systems to be installed at RIL’s Dahej and Nagothane facilities, propelling Wabag’s stock to new heights.

Stock Performance vs. Market Benchmark

By 10:10 AM, VA Tech Wabag’s share price stabilized at Rs 1,529.95 per share, up 4.13% from the previous close. In contrast, the BSE Sensex was trading modestly higher, up 0.18% at 81,611.72 points around the same time. VA Tech Wabag’s outperformance highlights the stock’s growing appeal in the water treatment industry, particularly on the back of lucrative contracts.

Long-Standing Partnership and Competitive Edge with RIL

According to Wabag’s official filing, “Wabag’s excellent track record with RIL for almost three decades and a technically superior and competitive bid ensured this repeat order win.” This robust relationship and technical expertise positioned the company well to secure the new contract. The order value, as per the filing, is estimated to range between Rs 300 crore to Rs 500 crore, adding significant weight to Wabag’s order book for the fiscal year.

Expanding Global Footprint: Major Win in Saudi Arabia

This new order comes on the heels of another major achievement for VA Tech Wabag. On September 6, the company announced that it had secured a $317 million (Rs 2,700 crore) contract from the Saudi Water Authority. The project involves the development of a 300 MLD mega seawater desalination plant in Saudi Arabia, a vital project that showcases Wabag’s expanding global presence and expertise in handling large-scale water infrastructure.

Analyst Upgrades Reflect Growth Potential

Following the Saudi order, ICICI Securities issued a report on September 9, reiterating its ‘Buy’ rating on VA Tech Wabag, while raising the target price to Rs 1,541 per share, up from Rs 1,445 per share. The firm cited the company’s robust order pipeline, its asset-light business model, and its global brand as factors contributing to its favorable long-term outlook.

In their report, ICICI Securities stated:
“VA Tech Wabag is well-positioned to capitalize on the increasing capital expenditure in the water segment both domestically and internationally, given its end-to-end solutions, strong brand, and visibility in key markets.” This sentiment aligns with the growing demand for water infrastructure globally, placing Wabag in an advantageous position to secure more high-profile contracts.

Industry Leader with Over 100 Years of Expertise

With over a century of experience, VA Tech Wabag has established itself as a global leader in the water treatment industry. The company provides comprehensive water and wastewater solutions for both municipal and industrial sectors, covering every aspect from design and engineering to construction, installation, and long-term operational management.

This extensive expertise has allowed Wabag to consistently outperform the market. Over the past year, VA Tech Wabag share price, the company’s stock has risen a staggering 223%, compared to the 23% gain of the BSE Sensex. This exponential growth reflects the market’s confidence in Wabag’s ability to deliver sustainable water infrastructure on a global scale.

Conclusion:

VA Tech Wabag’s recent order wins from Reliance Industries and the Saudi Water Authority demonstrate its growing dominance in the global water industry. The company’s strong partnership with RIL, along with its competitive edge in securing high-value contracts, positions it as a major player in water treatment infrastructure. With a proven track record, an asset-light business model, and strategic international projects, VA Tech Wabag is poised to continue its impressive growth trajectory, making it a standout stock in the water industry.

FAQs:

1.What caused VA Tech Wabag’s share price to surge?

A. The surge was driven by Wabag securing large water treatment orders from Reliance Industries (RIL).

2.What is the current price of VA Tech Wabag’s shares?

A. As of October 10, VA Tech Wabag shares reached an intraday high of Rs 1,534.65, up 6.9%.

3.What is the value of the new orders Wabag secured from RIL?

A. The order value ranges between Rs 300 crore to Rs 500 crore, as per Wabag’s filing.

4.What other major orders has VA Tech Wabag recently secured?

A. On September 6, 2024, VA Tech Wabag won a $317 million contract from the Saudi Water Authority for a mega desalination plant.

5.What is ICICI Securities’ target price for VA Tech Wabag?

A. ICICI Securities has raised its target price to Rs 1,541 per share, citing strong order wins and long-term growth prospects.

6.How has Wabag’s stock performed compared to the BSE Sensex?

A. VA Tech Wabag shares have surged 223% in the past year, vastly outperforming the Sensex’s 23% gain.

7.What type of water solutions does VA Tech Wabag provide?

A. Wabag offers total water solutions, including water and wastewater infrastructure for both municipal and industrial sectors.

8.What makes VA Tech Wabag stand out in the water industry?

A. Wabag’s asset-light business model, extensive global experience, and ability to secure large-scale international contracts make it a leader in the water industry.