Va Tech Wabag Ltd. share price target

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Q3FY17 revenue grew 14% YoY driven by strong growth in international projects (up 31% YoY); domestic revenue was almost flat YoY. Strong EBITDA margin at 11.4% (up 430 bps YoY) was driven by procurement & engineering efficiencies in international projects and provision reversal in the Oman project.

VA Tech Wabag (Wabag) reported strong Q3FY17 numbers excluding the payment of liquidated damages of | 64.3 crore (that the company paid for the Oman Desalination JV), due to which it reported a net loss for | 2.6 crore for the quarter. Excluding this exceptional loss, EBITDA margins and bottomline came in above our estimates while topline came in below our estimates Wabag reported revenue of | 718.3 crore, up 17.6% YoY (I-direct estimate: | 807.2 crore). Topline growth was due to on-track...

our earnings and valuation estimates downwards to account for slower sagar.gandhi@icicisecurities.com than expected improvement in EBITDA margins. We value the company at 17x FY18E earnings to arrive at a target price of | 640....

ICICI Securities Ltd | Retail Equity Research VA Tech Wabag reported revenues of | 580.3 crore, up 27.1% YoY (Idirect estimate: | 579.9 crore). Domestic operations contributed 44% to the topline. Also, 78% of the topline came from the O&M; segment while the remaining was contributed by the EPC segment Absolute EBITDA increased 127.7% YoY to | 27.5 crore (our estimate of | 24.4 crore). EBIDTA margins came in at 4.7% vs. 2.6% YoY due to improved execution during the quarter. This was despite a 6% YoY increase in employee expenses. Our estimates for EBITDA...

Background: VA Tech Wabag is a leading company in the water treatment space. The company has vast experience in plant building, planning, execution and operation of drinking water plants and waste water plants for both municipal and industrial sectors. The company has a multinational pedigree and offers customer specific solutions. The company has about 157 patents which include both products and process...

For 4QFY2016, VA Tech Wabag (Wabag) reported a 2.6% yoy decline in sales to Rs553cr, reflecting weak execution across the EPC-Municipal business. The EBITDA grew 19.2% yoy to Rs93cr while the EBITDA margin expanded by 306bp yoy to 16.8%. In-line with the EBITDA margin, the PAT margin expanded to 10.2% during the quarter vs 9.1% in 4QFY201..

EBITDA declined 4.1% YoY to | 121.3 crore (below our estimate of | 157.4 crore). EBIDTA margins came in at 14.1% vs. 13.9% due to lower employee & forex expenses. This was despite 6% YoY...

Key highlights: Revenues (Rs 8.6bn, 5% yoy) were materially lower than our estimate as execution disappointed in both parent operations and international subsidiaries. VATW lostouton20mnofrevenuesassomeprojects,particularlyinEgyptandSaudiArabia,did...