VA Tech Wabag shares surged by 7% on 10th October following the announcement of securing substantial repeat orders from Reliance Industries. The orders pertain to water treatment systems for Reliance's Dahej and Nagothane facilities. By 10:10 AM on Thursday, VA Tech Wabag was trading at ₹1,529.95 per share, reflecting a 4.13% rise. In contrast, the BSE Sensex saw a marginal increase of 0.18%, trading at 81,611.72 during the same period.
The rise in VA Tech Wabag's share price presents a compelling opportunity for those looking to invest in stocks within the water treatment industry.
Reliance partnership drives growth
VA Tech Wabag’s nearly three-decade-long partnership with Reliance Industries played a crucial role in securing this repeat order. According to the official filing, the company's history of successful projects with Reliance and its competitive, technically advanced bid ensured this latest win.
The order's value is between ₹300 crore and ₹500 crore, further enhancing Wabag’s standing in the market. The collaboration is set to strengthen both companies' positions in the industrial water treatment sector, with Wabag leveraging its expertise in water treatment solutions and infrastructure.
VA Tech Wabag’s global momentum
This order from Reliance comes shortly after VA Tech Wabag's success in securing a $317 million (₹2,700 crore) contract from the Saudi Water Authority for a large-scale seawater desalination project. This international win, coupled with the Reliance deal, highlights the company's strong presence both domestically and globally.
Following the Saudi deal, ICICI Securities recently upgraded its target price for VA Tech Wabag from ₹1,445 to ₹1,541 per share. The brokerage firm reaffirmed its ‘Buy’ recommendation, emphasising Wabag's unique position as a significant player in the water treatment space, benefiting from the increasing investments in the sector.
Strategic position in the water treatment sector
VA Tech Wabag’s ability to secure major contracts both in India and overseas underscores its strong brand, comprehensive solutions platform, and asset-light business model. Its extensive project reference list, along with its capability to deliver end-to-end solutions, has positioned the company to benefit from the rising capital expenditure in the water treatment segment globally.
With over a century of experience, Wabag has become a global leader in water and wastewater infrastructure, catering to both municipal and industrial sectors. The company's solutions cover design, engineering, supply, construction, installation, and long-term operational management.
Stock performance reflects investor confidence
The company’s stock has gained an impressive 223% over the past year, significantly outperforming the Sensex, which has risen by only 23% during the same period. This stellar performance demonstrates the growing investor confidence in VA Tech Wabag’s future growth potential, driven by its robust project pipeline and strategic partnerships.
For investors looking to invest in stocks with high growth potential, VA Tech Wabag presents an attractive option due to its strong fundamentals, proven track record, and leadership in the water treatment industry.
Conclusion
VA Tech Wabag’s continued success in securing large orders from prominent clients like Reliance Industries reflects its dominance in the water treatment industry. With its impressive stock performance and ongoing international expansion, the company is well-positioned to capitalise on the increasing global focus on water infrastructure development.
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