Antony Waste Handling Cell Limited: Sustained Growth and Strategic Diversification in Q2 FY26

Antony Waste Handling Cell Limited, a prominent player in India's waste management sector, reported a robust performance for the second quarter of Fiscal Year 2026. The company's consolidated operating revenue surged by 16% year-on-year to Rs.233 crores, demonstrating consistent execution and operational agility. This growth was underpinned by higher tipping fees, stable contributions from fixed shifts, trips, and household collection fees, alongside enhanced operational efficiency. The company's EBITDA for the quarter stood at Rs.57 crores, marking an 18% year-on-year increase with a healthy margin of 22%, reflecting strong financial discipline.

Segment-wise, both the Collection and Transportation (C&T) and Processing businesses delivered impressive growth. The C&T segment's revenue rose by 14% year-on-year to Rs.161 crores, while the Processing segment recorded a 22% growth, reaching Rs.72 crores. This balanced growth across key verticals underscores the effectiveness of Antony Waste's integrated waste management strategy. Total tonnage managed for Q2 FY26 increased by 6% to 1.27 million tons, and for the first half of the fiscal year, it grew by approximately 9% to 2.6 million tons. The Waste to Energy (WtE) plant at PCMC generated over 41 million green units in Q2 FY26, avoiding approximately 2,347 tons of carbon dioxide emissions, reinforcing the company's commitment to clean energy generation.

Strategic Initiatives and Future Outlook

Antony Waste is actively pursuing strategic initiatives to sustain its growth trajectory and enhance shareholder value. The company has secured two new Waste to Energy projects in Andhra Pradesh, with a combined value of around Rs.3,200 crores over a 20-year period. These projects, with an estimated capex of Rs.300-325 crores each and Rs.65 crores VGF, are expected to commence construction from Q4 2026. This move is crucial for diversifying revenue streams from municipal corporations to state electricity boards and expanding the company's footprint in the high-growth WtE segment.

Furthermore, the proposed merger of AG Enviro Infra Projects Private Limited, a wholly-owned subsidiary, with Antony Waste Handling Cell Limited is in its final stages. This restructuring aims to optimize operational efficiency, streamline the corporate structure, and unlock significant synergies. The company is also exploring new avenues such as the auto scrapping and tire recycling business, currently in discussions for land acquisition, which could further diversify its revenue base and offer higher margin potential.

Operational Efficiency and Risk Mitigation

Operational efficiency remains a core focus for Antony Waste. The implementation of a centralized stores management system has improved inventory management and facilitated bulk discounts from OEM suppliers. While the company acknowledges softer processing volumes and the impact of an extended monsoon period on margins, it anticipates improvement in the second half of FY26 as process volumes kick in. The management maintains an EBITDA margin guidance of 22.5% to 23%.

Addressing concerns regarding lower return ratios (ROCE and ROE), management clarified that these are a consequence of the significant capital employed in new, capital-intensive projects over the last three years. They expect these ratios to improve as assets depreciate and revenue streams stabilize over the long project lives. Debtor Days Outstanding (DSO) remained stable at 114 days, with a recent rectification bringing it to around 86 days, supported by efforts to increase non-municipal corporation revenue from power sales, EPR credits, and byproducts.

Concluding Thoughts

Antony Waste Handling Cell Limited's Q2 FY26 performance reflects a company in a strong growth phase, strategically expanding its capabilities and diversifying its revenue base. The focus on Waste to Energy projects, operational efficiencies, and a disciplined approach to capital allocation positions it well to capitalize on India's growing waste management market. The management's commitment to sustainability and transparent communication instills confidence in its long-term vision and ability to deliver consistent performance.