Porinju Veliyath Latest Stock Pick Va Tech Wabag

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Pee Vee
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Porinju Veliyath Latest Stock Pick Va Tech Wabag

Postby Pee Vee » Mon Mar 19, 2018 8:37 pm

Equity Intelligence, Porinju Veliyath PMS, has increased the holding in Va Tech Wabag to 5,46,51,900 shares.

This is as per Disclosures under Reg. 29(1) of SEBI (SAST) Regulations, 2011.

As per Choice India research report, these are the facts of Va Tech Wabag

•VA Tech Wabag Limited is a holding company engaged in water treatment field.

•The Company's principal activities include design, supply, installation, construction and operational management of drinking water, waste water treatment, industrial water treatment and desalination plants.

•The Company has four clusters: India, Europe, Middle East & Africa (MEA), and Latin America (LATAM).

•Its product portfolio includes water reclamation, municipal used water treatment, industrial effluent treatment, anaerobic sludge treatment, and industrial water reuse and recycling. Company Synopsis:

•WABAG Austria recently acquired a contract for a value worth Rs.1402.27mn in Tobruk, Lubya. The Tobruk Thermal Desalination Project at Libya is entrusted to WABAG by General Desalination Of Libya (GDCOL) and has a capacity of 13,300 m3/d.

•The company acquired a large repeat order from Dangote, Nigeria for a value of US$ 105.5mn and another large contract in the United Kingdom of Saudi Arabia worth US$ 84mn from one of the largest Oil and Gas companies.

•The company also bagged a repeat order with Reliance industries Limited, in India for a 24 MLD SWRO and 50MLD SWRO plants.

•The company acquired an order intake of Rs.36,000mn in the current year. Outlook:

•The goals set by 193 United Nations Member States in its 2030 agenda for Sustainable Development might play a crucial role in determining the future of drinking water, sanitation and hygiene, integrated water management and protection of ecosystems. The World Bank that estimates an investment of US$ 14bn every year would be required until 2030 for the sustainable development.

•The company is expecting large inflows from ‘Namani Gange’ for which the operation process has also started. The company has planned fund raising up to Rs.4000mn for meeting equity contribution criteria.

•The Government has increased its FY17-18 budgetary allocation to the Water Resources, River Development and Ganga Rejuvenation by 11%. The increase in the Government’s support in the operations of the business might prove to be helpful for the company in the future.

•The company is estimating clean water production of 21,700mn litres per day and 31,000mn litres per day of treated water.

•The company acquired an order intake of Rs.36,000mn in the current year, having a total intake of Rs.82,000mn including framework contracts. A strong order intake might be a reason for future increase in revenue generation.

•The Europe cluster of the company has a strong track record and technological references. The technological support from this cluster might lead to growth in the remaining clusters as the European cluster acts as the Technological Centre. The European cluster has a strong brand reputation which might help the company to manage future complex projects. The company is expected to participate in orders from Maharashtra for mega sewage treatment plants (Rs.80,000mn), Tamil Nadu for desalination plants, Delhi and Karnataka for water treatment. Valuation:

•On our valuation front, at CMP Rs.480.0, the company is trading at a P/E multiple of 17.8x, which is at a discount as compared to the average P/E of 25.9x and an EV/EBITDA multiple of 9.2x which is at a premium as compared to the average EV/EBITDA multiple of 8.5x. After considering all the above factors and high probability of strong growth in the future, we recommend a “ buy & add on dips” rating on this stock.

Porinju Veliyath's latest stock pick looks like a multibagger stock.

valuepicker
Posts: 105
Joined: Mon Jan 09, 2017 8:44 am

Re: Porinju Veliyath Latest Stock Pick Va Tech Wabag

Postby valuepicker » Wed Mar 28, 2018 7:55 pm

With focus on water this company with niche offering should be a great compounder next 5 years. A must have in your value portfolio


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