Va Tech Wabag Ltd

Price story Before the numbers, the tape. A stock price moves through four repeating seasons: a flat base (stage 1), an advance (2), a top (3), a decline (4). Where the price sits in that cycle frames everything below.

Va Tech Wabag Ltd trades at ₹2,278, in a confirmed uptrend and 17 weeks into that stage. That is +35.3% against its own 200-day average. It sits at 100% of a 52-week range of ₹1,061 to ₹2,278. On relative strength it has been ahead of the NIFTY 500 on a trailing-13-week view for 33 straight weeks.

Today the stock is in a confirmed uptrend — week 17 of stage 2, confirmed. At ₹2,278 it trades +35.3% versus its 200-day average and sits at 100% of its 52-week range (₹1,061–₹2,278).

Against the market, two honest reads. Cumulative: over the last 10.5 years the stock moved +338% while the NIFTY 500 moved +267% — ahead of the index over the full window. Recent form: on a trailing-13-week view the stock has been ahead for 33 straight weeks — the ribbon below is that same metric, week by week.

What would end the trend, mechanically: two Friday closes in a row below the 200-day line. That is the exit rule — no debates.

Story check

Va Tech Wabag Ltd's story is not scored yet against the markers our research file set on 22 August 2026. Where it sits in its own cycle: Not stated in the research file. Our fortnightly research layers last read it on 22 August 2026.

What is proven. See the research file

What is not proven yet. A sustained failure to convert backlog into revenue and cash, evidenced by lower order intake, operating margin at or below normalized levels, and further receivables-led cash absorption, would invalidate the thesis.

🚨 What would change our mind. A sustained failure to convert backlog into revenue and cash, evidenced by lower order intake, operating margin at or below normalized levels, and further receivables-led cash absorption, would invalidate the thesis.

🚨 Layer 1 read, 22 August 2026 — DROP. Revenue is growing 21% but the profit from actually building things went DOWN — the reported jump is other income. Wabag sold 21% more this June quarter than last, but the profit it earned from that work fell from Rs 96 crore to Rs 80 crore, and the reported profit only rose because Rs 58 crore of income arrived from outside the operations, against Rs 11 crore a year earlier. That is a problem at a share price that already costs 31 times earnings, the 88th percentile of its own ten-year record; restating earnings for that unusual income pushes it to the 99th percentile, though that restatement is a model estimate rather than a hard fact. What holds the case together is the Rs 194 billion order backlog — more than four years of work at this run rate — and management delivering FY26 revenue growth at the…

What would change Layer 1’s mind. One clean quarter would flip this: September 2026 operating margin back at or above the guided 13-14% band with other income under about 20% of pre-tax profit, showing the 9% June margin was project mix and not permanent cost. Equally, a SIGNED Kuwait or Hadda award (not preferred status again) plus cash conversion back at or above 0.76 would turn P2 into P1. The reverse — a second quarter of single-digit operating margin, or receivable days above 234 — would move this from STRAINED to VIOLATED.

The test written in advance. A sustained failure to convert backlog into revenue and cash, evidenced by lower order intake, operating margin at or below normalized levels, and further receivables-led cash absorption, would invalidate the thesis. — the thesis as written as stated by the next result.

The test written in advance. Normalized valuation risk — Normalized valuation risk Other income remains elevated while operating profit and operating margin fail to improve. by the next result.

The test written in advance. Receivables-led cash absorption — Receivables-led cash absorption OCF/PAT remains below the three-year figure and receivable days continue increasing. by the next result.

What the company does. Latest-quarter revenue and reported profit grew year on year, supported by project execution and a large backlog. The operating question is whether O&M transition and international execution can offset the lower latest-quarter operating margin. At the current price, normalized earnings imply a substantially higher valuation multiple than the trailing figure.

Lever 2 · Value-added mix — BUILDING. Completed projects entering O&M can increase recurring revenue and reduce dependence on EPC phasing. What proves it keeps working: O&M mix expansion. It stops working if Commissioning is delayed or O&M transition does not raise reported revenue mix over successive quarters.

Lever 10 · New geographies — BUILDING. Kuwait, Saudi Arabia and other international projects widen the addressable market but introduce award and execution timing risk. What proves it keeps working: GCC and international project platform. It stops working if Preferred-bidder positions do not become signed orders or geopolitical events delay execution without recovery.

Sources: our stock research file (22 August 2026) · quarterly results through Jun 26 · the company’s own earnings calls. The story check is re-scored every results season; the record below never changes.

Revenue Revenue is the top line: everything the company billed its customers in the period.

Va Tech Wabag Ltd reported ₹887 Cr of revenue in the Jun 26 quarter, +20.8% year on year. That is the 11th straight quarter of year-on-year growth. Over 10 years it has compounded at 4.6% a year. The last full year, FY26, came in at ₹3,944 Cr. The last four reported quarters add to ₹4,096 Cr.

Why this happened. The latest call reported a closing backlog over four times revenue and orders across execution phases. This supports revenue visibility, although specific Saudi award timing remains uncertain.

FY26 revenue came in at ₹3,944 Cr (+19.7% on the year), capping 10 years at 4.6% compound. The latest quarter (Jun 26) printed ₹887 Cr, +20.8% year on year — the 11th consecutive quarter of year-over-year growth.

Pace check: the last four quarters averaged +20.2% growth against the decade's 4.6% — the current year is running faster than its own long-run rate.

Acceleration check: trailing-twelve-month revenue grew +20.4% over the last 4 quarters against +18.3%/yr over the last 8 — stabilising; TTM profit +28.8% vs +24.1%/yr — accelerating.

Operating margin Operating margin is what is left of every ₹100 of sales after running the business, before interest and tax. It is the cleanest read on pricing power and cost control.

Va Tech Wabag Ltd's operating margin is 9.0% in the Jun 26 quarter, −4.0 percentage points against the same quarter a year ago. Across 13 fiscal years the operating margin has ranged 7.0% to 13.0%. The current quarter sits inside that band.

Why this happened. Management described proprietary technology, project screening and lifecycle-cost bidding as the basis for selectivity. The thesis needs evidence that this discipline converts into operating profit rather than only backlog.

The latest quarter's operating margin is 9.0%, −4.0 pp against the same quarter a year ago. Across 13 fiscal years the operating margin has ranged 7.0%–13.0%.

🚨 Why the margin moved: operating margin went −4.1 pp year on year while gross margin went −0.5 pp — the loss came mostly below the gross line: operating leverage, with costs spread over a bigger revenue base.

Net profit Net profit is what survives every cost, interest and tax — the number EPS, dividends and book value all grow from.

Va Tech Wabag Ltd earned ₹90.0 Cr of net profit in the Jun 26 quarter, +36.4% year on year. It is the 9th consecutive quarter of growth. Full-year FY26 profit was ₹370 Cr. The 10-year compound rate is 15.2%. That is 10.1% of the quarter's revenue. The same quarter a year earlier earned ₹66.0 Cr.

Jun 26 profit was ₹90.0 Cr, +36.4% year on year — the 9th consecutive quarter of growth. On the full year, FY26 printed ₹370 Cr (+25.4%), and the 10-year compound rate is 15.2%.

Why profit moved: revenue contributed +20.8% and the margin −4.0 pp — the quarter was revenue-led despite a thinner margin.

Pace comparison, last four quarters: profit +29.0% vs revenue +20.2%. Profit is growing faster than sales — fixed costs are being spread over a bigger base, and each extra rupee of revenue drops more to the bottom line.

Cash flow — the router The P&L says what was earned; the cash-flow statement says what actually arrived. Operating cash flow (CFO) against profit is the cleanest lie detector in the accounts.

Over the last 3 fiscal years 76% of Va Tech Wabag Ltd's reported profit arrived as operating cash — most of the profit is real cash. In FY26 that was ₹207 Cr of operating cash against ₹370 Cr of profit. After ₹5.0 Cr of capital spending, ₹202 Cr was left as free cash.

FY26: operating cash of ₹207 Cr against reported profit of ₹370 Cr, leaving free cash of ₹202 Cr after ₹5.0 Cr of capital spending. Across the last 3 fiscal years the conversion rate is 76% of profit.

Cash-flow readings here are annual — that is the resolution our series carries, so this section moves once a year.

Why conversion sits at 76%: the cash cycle stretched 60 days between FY21 and FY26 — more of each rupee of profit waits inside the cycle before arriving.

Router verdict: conversion is below par and the cash cycle has stretched 60 days — the next section's job is to find where the cash is stuck.

Where the cash goes Working capital is the cash tied up between paying suppliers and getting paid: debtor days (customers owe), inventory days (stock waits), and the cash conversion cycle (the whole loop, in days of sales).

Va Tech Wabag Ltd's cash conversion cycle runs 234 days in FY26, up from 174 days in FY21. Capital spending ran ₹11.0 Cr over the last 3 years. At FY26 sales of ₹3,944 Cr each day of that cycle holds about ₹10.8 Cr, so roughly ₹2,528 Cr sits inside the business at any moment.

Why this happened. Management reported O&M at 18% of revenue and described Ghaziabad and Bhagalpur moving into O&M. The mix shift becomes material only when it persists in reported revenue.

FY26: debtors at 234 days (an asset-light business — no inventory to speak of) — for a full cycle of 234 days, looser than FY21's 174.

In money terms: at FY26 sales of ₹3,944 Cr, each day of the cycle holds about ₹10.8 Cr — so the 234-day loop keeps roughly ₹2,528 Cr sitting inside the business at any moment.

On the investment side: capital spending of ₹11.0 Cr over the last 3 fiscal years against ₹20.0 Cr of depreciation — spending at or below maintenance level. Capital work-in-progress stands at ₹0.0 Cr (FY26) — capacity paid for but not yet earning.

The synthesis: the working-capital loop is the cash sink the router flagged — watch the cycle, not the P&L.

Return on capital Return on capital employed (ROCE) is the profit the whole business earns on all the money in it — equity and debt together. It is the single best test of whether growth creates value or just size.

Va Tech Wabag Ltd earns a ROCE of 21% in FY26. That is up from a trough of 11% in FY19. Return on invested capital clears the cost of that capital by +7.1 percentage points, so growth here adds value rather than only size. The wiring behind it is 9.4% net margin on 0.64× asset turns.

FY26 ROCE is 21%, recovered from a FY19 trough of 11% — the full ladder below shows the fall and the climb, undoctored.

Why the return is what it is — the wiring (FY26): 9.4% net margin × 0.64× asset turns × 2.38× balance-sheet leverage ≈ 14.3% on equity. Margin does its share; leverage is a meaningful part of the equation.

The capstone test — ROIC − WACC: 19.1% − 12.0% = a +7.1 pp spread. The 12.0% is a standing assumption for the cost of capital in India, not a per-stock estimate — read the sign and the size of the spread, not the decimals. A spread this wide means every rupee reinvested creates more than a rupee of value — the engine compounds.

Debt Debt-to-equity says how much of the business is funded by borrowings. Low is the safe corner; the trend matters as much as the level.

Va Tech Wabag Ltd carries total debt of ₹228 Cr against shareholder equity of ₹2,574 Cr as of Mar 26, a debt-to-equity of 0.09 — effectively unlevered. On the annual view that ratio went from 0.29 in FY22 to 0.09 in FY26. The returns elsewhere on this page are therefore earned rather than borrowed.

Mar 26: total debt of ₹228 Cr against shareholder equity of ₹2,574 Cr — a debt-to-equity of 0.09. On the annual view, debt-to-equity went from 0.29 (FY22) to 0.09 (FY26). The returns on this page are earned, not borrowed.

Ownership Who owns the stock, quarter by quarter: promoters (the controlling owners), foreign and domestic institutions, and the public. Steady accumulation by people close to the numbers is a signal; a quiet register is also an answer.

Foreign institutions added 6.7 points of Va Tech Wabag Ltd over 8 quarters, the biggest move on the register. That takes foreign institutions to 18.3% of the company. Domestic institutions moved +1.3 points over the same window, to 6.3%. The register is read on the four disclosed classes only; nothing is inferred between filings.

The register over the last two years — Foreign institutions: +6.7 points over 8 quarters to 18.3%; Domestic institutions: +1.3 points over 8 quarters to 6.3%; Promoters: +0.0 points over 8 quarters to 19.1%. Note the structure: promoters hold under 20% — this is a widely-held company where institutions, not a family, set the direction.

Why the register moved: foreign institutions drove it (+6.7 points), alongside domestic institutions (+1.3 points) — steady accumulation by institutions reading the same numbers this page reads.

Safety line The Z-score estimates how far a company sits from balance-sheet distress — above roughly 3 is safe, below roughly 1.8 is the danger zone. It was built for manufacturers, so it is not applied to banks and lenders.

Va Tech Wabag Ltd: the Z-score is not available for this stock, so we say so rather than invent one. It is a distance-to-distress estimate from the balance sheet, not a forecast of failure. The debt, cash-flow and return sections above carry the balance-sheet evidence this page does hold, and each of them states its own reporting date.

The safety line in one sentence: the Z-score is not available for this stock, so we say so rather than invent one.

Valuation P/E is the price of ₹1 of annual profit: how many rupees the market pays for each rupee the company earns in a year.

Va Tech Wabag Ltd trades at 35.7× P/E, at the pricey end of its own range (93rd percentile). Its long-run median P/E is 17.1×, measured across 10.5 years of weekly readings. This places the multiple against the stock’s own record, and says nothing about what the business is worth.

Today's P/E of 35.7× is at the pricey end of its own range (93rd percentile), against a long-run median of 17.1× measured over 10.5 years of weekly readings. This is a comparison against the stock's own history — not a claim about what it is worth.

Why the multiple sits where it does: over the past year annual EPS moved +25.2% against a +49.0% price move — the price outran earnings, pushing the multiple UP its own range.

The price move, decomposed: over 5y, of the +46.7%/yr price move, ~+27.1%/yr came from earnings growth and ~+19.6 pp from the multiple (expanding); over 10y, of the +14.9%/yr price move, ~+12.9%/yr came from earnings growth and ~+2.0 pp from the multiple (expanding). The split is the honest approximate (price return minus earnings growth); it makes the rally itself visible instead of hiding it behind the percentile.

Put together: the multiple is full against its own past, so the story rests on the earnings line underneath it, not the multiple.

What the price assumes This reading works the multiple backwards. It asks one question: what yearly rate of profit growth is a buyer at the market price already paying for? The number is the growth rate that makes eleven years of profit — six years growing, then five fading — add up to that day's market price, once each year is discounted at 11% a year.

Solved at its 26 August 2026 price, Va Tech Wabag Ltd was paying for profit growth of about 18.2% a year. Profit itself has compounded 15.2% a year over the past 10 years. Today the market pays 35.7× P/E, the 93rd percentile of its own 11-year range.

What the two numbers say together. The multiple is full against its own past, and the growth the price is paying for is close to what this company has actually delivered.

How to hold this number: it is a reading of one day's price, taken on 26 August 2026, not a running figure — every other number on this page, the multiple included, is read off the live quote as of 11 September 2026. A higher price is paying for more growth and a lower price for less, so it moves whenever the price does, and this page does not restate it between measurements.

Stage: Consistent Every business sits somewhere on a fundamental arc, and this page names the spot before anything else. The last twelve quarters of revenue, profit and EPS growth — plus the return the business earns on its capital — are read as curves: Deteriorating (the curves are falling), Turning around (a trough has just formed and the last few quarters lift off it), Improving (the climb off the trough is sustained), Consistent (steadily positive with healthy returns), Topping out (still high but decelerating from the peak). When the curves genuinely disagree the read is Mixed; too little history is No read. CAGR (compound annual growth rate) is the smooth yearly pace that turns the starting value into the latest one — the fairest way to compare growth across different time spans. Read the columns together: if the 1-year number towers over the 10-year, recent growth is running hotter than the long-run trend. A dash means that window is not held, or the base year was a loss (where a growth rate is not meaningful).

Va Tech Wabag Ltd reads as consistent on its fundamental arc. Consistent — revenue, profit and EPS growth have stayed positive through the window, with ROCE at 19.1% and holding. The read is built from 12 quarters across 4 curves, on full evidence.

Why it matters: steady curves with healthy returns are the compounding setup — the risk is the price, not the business.

4-Factor Sector Score

65.8/100 — rank 1 of 4 in Water Treatment · 97% evidence confidence

Va Tech Wabag Ltd scores 65.8 out of 100 against the 4 companies it is compared with in Water Treatment, ranking 1. Balanced evidence: keep at normal research priority and require another comparable period before raising conviction.

The four contributions add to the total exactly: 21.4 + 16.1 + 9.2 + 19.1 = 65.8. This is the SAME number shown on the sector comparison — it is computed once, for the whole peer set, and read here.

What would change it: The read weakens if profit growth turns negative or margin improvement reverses while sector-relative strength deteriorates.

Said versus delivered

What Va Tech Wabag Ltd's management promised, set against what actually arrived — 4 tracked promises on the record. Read straight from the company’s own earnings calls. A promise that slipped stays on this page after it is met.

Apparent Al-Haer Project Status Regression · 13 August 2026. The Feb 2026 and May 2026 calls described the Saudi Al-Haer project as advancing rapidly, with construction completed and commissioning expected. The latest call describes a similarly named project, transcribed as {? Al Hayl ?}, as still having installation underway, an apparent reversal in execution stage with no explanation; the project name should be verified against the source audio.

🚨 Hadda Award Timing Has Slipped · 13 August 2026. Management indicated in Feb 2026 that the Hadda award could occur within FY26 and in May 2026 that the Saudi award might occur in the following quarter. By Aug 2026, the latest call still described Hadda only as a preferred EPC partner and did not explain why the expected award had not materialized, creating a material timing risk for order inflow and backlog conversion.

Perur Desalination Project Milestones · 25 May 2026. Management prematurely claimed the complete completion of all marine activities at the JICA-funded Chennai Perur Desalination Plant in the Nov 2025 call. However, subsequent calls in Feb 2026 and May 2026 revealed that the critical marine work was still incomplete and in progress.

Semiconductor Market Opportunity Tempering · 6 February 2026. In the November 2025 call, management aggressively touted the Ultra-Pure Water opportunity for semiconductors and solar as a INR 3,500 crore market available in the next 3-5 years, positioning themselves as leading players. However, in the February 2026 call, they walked back the domestic semiconductor enthusiasm, stating fabrication units are taking time and current opportunities are restricted to assembly units which have 'lesser water requirement'. Earlier call (Nov 2025): “We are talking somewhere around 100 to 150 MLD of Ultra-Pure Water in the next 3 to 5 years time line. And roughly, you can say that this will be a market of around, say, INR3,500 crore. ... WABAG is ideally positioned to become a leading player in this fast-growing market.” Later call (Feb 2026): “Fabrication is some of those possibilities which were there, that is taking some time... In India now mostly it is assembly part which has a lesser of water requirement.”

Every quote above is taken word for word from the company’s own earnings calls.

Frequently asked questions