VA Tech Wabag (WABAG) Q2 24/25 earnings summary

Executive summary

• Achieved strong earnings growth in Q2 and H1 FY2025, maintaining a profitable growth trajectory and net cash positive position.

• Secured major orders, including a 300 MLD desalination plant in Saudi Arabia (INR 2,700 crore), a 100 MLD plant for Indosol Solar (INR 1,000 crore), and 400 MLD Perur, Chennai, expanding presence in the Middle East and solar PV sector.

• Order inflow for H1 exceeded INR 4,600 crore, with a record order book over INR 146 billion, providing robust revenue visibility and growth momentum.

• Repeat orders from Reliance Industries and Chennai Metropolitan Water Board reinforce client trust and long-term relationships.

• Preferred bidder status in marquee projects worth over INR 35 billion and recognized with multiple awards for project execution and sustainability.

Financial highlights

• Consolidated H1 revenue reached INR 13,268 million, up 11% year-over-year (excluding divested European entities); standalone revenue at INR 11,592 million.

• Consolidated EBITDA for H1 was INR 1,854 million, up 19% year-over-year; PAT at INR 1,256 million, up 30.7% year-over-year, with a PAT margin of 9.5%.

• Net cash position at INR 2,220 million as of H1; excluding HAM entity debt, net cash at INR 3,375 million.

• Gross cash position at INR 645 crore, with INR 294 crore in cash/bank and INR 351 crore in term deposits.

• ROCE at 18.3% and ROE at 14.6% for H1 FY25.

Outlook and guidance

• Confident of sustaining growth momentum in H2 FY2025, with an order inflow outlook of over INR 8,000 crore and order book expected to surpass INR 16,000 crore by fiscal year-end.

• Medium-term revenue CAGR guidance of 15%-20% over three to five years; EBITDA margin guidance of 13%-15% and ROE above 15%.

• O&M business expected to contribute 20% of total revenues.

• Asset-light business model and net cash positive position maintained for seven consecutive quarters.