Va Tech Wabag reported a robust start to FY27, with consolidated net profit rising 37% YoY to ₹901 Mn for the quarter ended June 30, 2026. Consolidated revenue from operations grew 21% YoY to ₹8,868 Mn, while EBITDA increased 22% YoY to ₹1,163 Mn. The EBITDA margin expanded marginally to 13.11% from 13.02% in the corresponding quarter of the previous year. The strong financial performance was underpinned by an order intake of ₹34 Bn, pushing the total order book to an all-time high of ₹194 Bn, providing over four times revenue visibility for the coming quarters.

The Board of Directors approved the unaudited financial results on August 12, 2026, in compliance with Regulation 33 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The results were reviewed by the Audit Committee and subjected to a limited review by the statutory auditors, Sharp & Tannan. The company maintained its net cash-positive position for the 14th consecutive quarter, with a net cash position of ₹9,649 Mn excluding held-for-sale assets.

Financial performance highlights

The table below summarises consolidated and standalone performance for Q1FY27 versus Q1FY26.

*EBITDA figures derived from press release disclosures; source table provides profit before tax and other line items.

Segment-wise performance

International markets contributed significantly to the growth trajectory. Rest of the world revenue surged 48% YoY to ₹4,660 Mn, compared to ₹3,155 Mn in the same period last year. India segment revenue grew modestly by 1% YoY to ₹4,228 Mn. The rest of the world segment also drove profitability, with segment results rising from ₹923 Mn to ₹1,113 Mn YoY.

Geographically, 48% of the revenues came from India and 52% from overseas markets. EPC contributed 82% of the revenues while O&M contributed 18%. Management highlighted that forex gains are considered operational due to the company's increasing international exposure, noting that transaction gains are part and parcel of the business as invoices are raised and collected in foreign currencies.

Strategic order wins and book analysis

Chairman & Managing Director Rajiv Mittal highlighted that all clusters delivered on order intake, resulting in the surge to approximately INR 19,400 crores in the order book. Key wins included a "Mega" SWRO project in Kuwait, marking the company's entry into the market, and an order win in Ajman, UAE. In Europe, Va Tech Wabag secured a key project from Donauinsel Water Works in Austria. Domestically, the company enhanced relationships with BWSSB and DJB through new order wins. Mittal noted that these wins reflect a focus on complex technology jobs within the company's focus area.

The investor presentation detailed the composition of the ₹193,942 Mn order book. By business offering, EPC projects constituted ₹127,280 Mn (65%) while O&M contracts accounted for ₹66,662 Mn (35%). Geographically, the order book was nearly evenly split, with India contributing ₹99,786 Mn (51%) and overseas markets holding ₹94,156 Mn (49%). Major pending projects include a 300 MLD desalination plant in Yanbu Al-Bahr, KSA, and a 272 MLD plant in Doha, Kuwait.

Management clarified that the current order book excludes approximately ₹600 crore worth of framework orders that were previously included but removed prudently as they were awaiting effectiveness. The remaining backlog consists entirely of effective orders ready for execution. The Middle East region accounts for approximately 35-40% of the total order backlog.

Execution and operational updates

Execution across major projects continues to progress well. At the flagship Perur desalination project in Chennai, funded by JICA, the company crossed an important construction milestone with 1 lakh cubic meters of concreting completed, the highest ever in its history on a single project. With critical marine works already behind them, the project is progressing steadily towards completion, with management estimating it to be over 75% complete.

In the Middle East, the Ras Tanura Industrial Wastewater Treatment plant has entered the decommissioning phase after equipment delivery and installation. The Al Haer wastewater treatment project is progressing well with engineering and procurement largely complete. Management stated that geopolitical developments in the region have had no material impact on projects, operations, or underlying demand, citing historical experience in managing such events and contractual protections for force majeure scenarios.

New industry focus through special initiatives

Beyond its core water infrastructure business, Va Tech Wabag is targeting emerging industrial segments through a dedicated special initiatives team. The company is focusing on future energy solutions including data centers, solar, semiconductors, and green hydrogen. Contributions from these new industry verticals are anticipated in 3-7 years. Management noted that while traditional industrial markets like oil and gas remain core, the objective is to grow the industrial order mix to around 20-25% over time.

What the numbers show

The divergence between domestic and international growth highlights Va Tech Wabag's successful global expansion strategy. While India revenue remained flat, the near-50% rise in overseas revenue indicates that new market entries in Kuwait, UAE, and Europe are materialising into topline growth. The expansion of the order book to ₹194 Bn, combined with a net cash position of ₹9,649 Mn, points to strong balance sheet resilience and high future earnings visibility despite the capital-intensive nature of water infrastructure projects. The slight expansion in EBITDA margin from 13.02% to 13.11% demonstrates operational efficiency alongside volume growth. Additionally, the shift towards more international orders is expected to improve working capital quality, as payment patterns in overseas markets are generally tighter than in domestic ones, supporting the company's trend of reducing net working capital days from 130 days three years ago to 108 days in Q1FY27.

Va Tech Wabag management has outlined its financial targets, aiming for revenue growth of 15% to 20% while targeting a medium-term EBITDA margin range of 13% to 15%. For the current year, the company expects EBITDA margins to settle between 13% and 14%.

The leadership team expressed confidence in achieving or exceeding the stated revenue growth goal. This guidance reflects a focus on balancing top-line expansion with disciplined margin management in the near term.

Operational Targets

Beyond financial metrics, Va Tech Wabag has defined specific operational goals regarding working capital and order composition:

• Working Capital: The company plans to keep net working capital days between 100 to 110, with an aim to lower this figure further.
• Order Mix: The long-term goal is to raise the industrial order mix to about 20% to 25% of total orders.
• Order Backlog: Management is confident in maintaining an order backlog multiple of over four times revenue.

What the Numbers Show

The divergence between the current year’s expected EBITDA margin (13% to 14%) and the medium-term target (13% to 15%) suggests a phased approach to margin expansion. By simultaneously targeting a reduction in net working capital days from the current 100 to 110 range, the company signals an intent to improve cash conversion cycles alongside profitability. This indicates that future margin gains may be supported not just by pricing or cost efficiencies, but also by tighter working capital management.