7 WABAG share price target reports by brokerages below. See what is analyst's view on WABAG share price forecast, rating, estimates, valuation and prediction behind the target. You may use these research report forecasts for long-term to medium term for your investment or trades in 2020.
VAW is trading at 9.0x and 7.8x, FY21E and FY22E earnings respectively. In view of the good order book and cash generation in 9MFY20, we have revised earnings upwards in FY20E/21E. We continue to value the stock at 10x FY22 earnings (earlier 10x FY21 earnings). Thus, arriving at a price target of Rs 280 (earlier target price of Rs 202). We will accord higher target multiple if 1) receipt of retention money from TSGENCO/APGENCO and 2) and improvement in project execution rate.
Looking at the waste water treatment opportunities in India, we believe VA Tech is in a sweet spot in terms of potential order wins going ahead, which would bolster order backlog going ahead. However, we believe bloated working capital would limit the company’s execution capabilities and thereby the earnings growth, going ahead. We value the company at 10x PER FY21E and arrived a target price of Rs 200. We have a REDUCE rating on the stock.
We cut our estimates for FY20/FY21 by 10%/6% to factor in lower-than-expected execution and margins. We lower our TP to INR195 from earlier INR260 on account of (a) earnings cut, and (b) cut in target FY21E P/E multiple to 8x v/s earlier 10x, which is in line with our coverage universe for the EPC space. Maintain Neutral given the deteriorating working capital cycle (176 days v/s 70-80 days historically) and the sticky receivables from APGenco and TSGenco worth INR4.2b.
VAW is trading at 12.9x and 7.9x, FY20E and FY21E earnings respectively. We have scaled down our earnings and also curtailed our target PE in view of the delay in collecting long overdue receivables. As a result, our target price stands reduced to 202 (earlier Rs 300), valuing the stock at 12x average EPS of FY20E & FY21E (earlier 15x FY20 earnings).
VAW is trading at 19.0x and 10.6x, FY20E and FY21E earnings respectively. In view of the long term growth potential in water and waste water treatment and reasonable valuations, we maintain rating at “ADD” with price target of Rs 300 (earlier Rs 335), valuing the stock at 15x average EPS of FY20E & FY21E (earlier 13x FY20 earnings).
On the order backlog front, we expect order book to grow at 22.6% CAGR in FY19-21E. We expect revenue, EBITDA and PAT CAGR of 20.2%, 29.4% and 29.8%, respectively. Receivables from Genco projects continue to remain a concern, which is now at Rs 415 crore, (of which | 115 crore is expected by Q2FY20E). Delay in receivables has strained the balance sheet. Wabag may also have to raise additional capital to fund its liability mismatches. Accordingly, we remain cautious on the company. We value the company at 11x FY21E earnings to arrive at a target price of Rs 270. We recommend REDUCE on the company.
VAW is trading at 13.7x and 11.4x, FY20E and FY21E earnings respectively. In view of the long term growth potential in water and waste water treatment and reasonable valuations, we move rating to “ADD” (earlier BUY) with price target of Rs 335 (earlier Rs 338), valuing the stock at 13x FY21E (earlier 13x FY20 earnings).
SOURCE: Data from D'Market via Quandl. Intraday data delayed 15 minutes.
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