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Analysts Remain Bullish on VA Tech Wabag Despite Recent Dip

Analysts Remain Bullish on VA Tech Wabag Despite Portfolio Stock Dip

Despite the recent decline in shares of VA Tech Wabag Ltd., a company included in the portfolio of renowned investor Rakesh Jhunjhunwala, market buzz around the stock persists. On Tuesday, the stock closed at ₹1,480.00, down 5.40%. While trading 23% below its 52-week high, analysts maintain a positive outlook, viewing it as a b long-term investment opportunity.

104% Return Last Year

Despite the recent dip, VA Tech Wabag delivered a 104% return over the past year, significantly outperforming the Nifty 50's 7% return. This highlights the stock's superior performance compared to the broader market, leading analysts to anticipate a potential rebound.

Strong Technical Indicators

VA Tech Wabag is trading above its 200-DMA (Daily Moving Average), which acts as a b support zone at ₹1,375. Its primary resistance level lies around ₹1,650.

Nilesh Jain, Head of Technical and Derivative Research at Centrum Broking, advises investors to accumulate the stock as a potential bet, anticipating future strength despite current market volatility.

Growth Expected from International Partnerships

Analysts believe VA Tech Wabag's potential upswing isn't solely dependent on technical factors; new business triggers could further accelerate its growth.

According to Aniket Jain, an analyst at Yes Securities, the company's planned partnership with international investors for up to $100 million in investments in the municipal water sector is a positive sign.

This investment is expected to expand the company's order book, enabling it to bid for larger projects without financial constraints.

Yes Securities Maintains Buy Rating with ₹1,750 Target Price

Yes Securities has reaffirmed its 'buy' rating for VA Tech Wabag, projecting a target price of ₹1,750.

This valuation is based on FY27 EV/EBIT multiple (16x) and PE multiple (24x), indicating b growth prospects for the coming years.

Consistent Improvement in Financial Performance

According to Yes Securities, VA Tech Wabag's net profit could reach ₹290 crore in FY25, a 16% increase from ₹250 crore in FY24.

Furthermore, the company's revenue is projected to grow by 11%, increasing from ₹2,827 crore in FY24 to ₹3,127 crore in FY25.

Increased Profitability in Q3, 12% YoY Growth

VA Tech Wabag reported a 12% year-on-year increase in consolidated profit after tax (PAT) during the third quarter (October-December) of FY25.

Net profit rose from ₹63 crore in the same period last year to ₹70 crore. Revenue also increased by 17%, reaching ₹825.8 crore.

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