WABAG H1 revenue rises 20.3% as net cash hits Rs 1,144.2 crore

VA Tech Wabag Ltd. reported consolidated H1 FY27 revenue of Rs 1,887 crore, up 20.3% year on year, while net cash excluding hybrid annuity model, or HAM, borrowings reached Rs 1,144.2 crore at Q2 FY27, compared with Rs 950 crore at Q4 FY26.

How did WABAG perform in H1 FY27?

WABAG increased consolidated revenue from operations to Rs 1,887 crore in H1 FY27 from Rs 1,568.5 crore in H1 FY26, a 20.3% increase. In Q2 FY27 alone, revenue was Rs 1,000.2 crore, compared with Rs 834.5 crore a year earlier, representing 19.9% growth. Q2 therefore accounted for more than half of reported first-half revenue.

Consolidated earnings before interest, tax, depreciation and amortisation, or EBITDA, rose 20.7% to Rs 260.8 crore in H1 FY27 from Rs 216.1 crore in H1 FY26. EBITDA margin was unchanged at 13.8%, meaning EBITDA increased broadly in line with revenue across the first half. In Q2 FY27, EBITDA was Rs 144.6 crore and the margin was 14.5%, versus Rs 120.5 crore and 14.4% respectively in Q2 FY26.

WABAG’s standalone business also expanded on a smaller revenue base than the consolidated business. Standalone H1 FY27 revenue was Rs 1,587.1 crore, up 19.3% from Rs 1,330.2 crore, while standalone EBITDA rose 20.0% to Rs 226.9 crore. The standalone EBITDA margin edged up to 14.3% from 14.2%, compared with the unchanged 13.8% consolidated margin.

Why did WABAG’s profit rise faster than revenue?

WABAG’s consolidated profit after tax, or PAT, increased 29.3% to Rs 194.7 crore in H1 FY27, exceeding the 20.3% revenue increase. The profit margin rose to 10.3% from 9.6%, a 0.7-percentage-point increase. Q2 PAT grew 23.3% to Rs 104.6 crore from Rs 84.8 crore, with quarterly profit margin increasing to 10.5% from 10.2%.

The statement shows net interest income of Rs 15.3 crore in H1 FY27, compared with Rs 8.4 crore in H1 FY26, while bank charges declined to Rs 24.2 crore from Rs 25.1 crore. Tax increased to Rs 59.6 crore from Rs 46.9 crore, and the share of profits or minority interest line was a Rs 5.4 crore loss, versus a Rs 1.2 crore loss. These movements occurred alongside an EBITDA increase of Rs 44.7 crore.

Operating costs also rose with revenue. Consolidated cost of sales increased to Rs 1,392.9 crore from Rs 1,169.4 crore, and total cost of operations rose to Rs 290.3 crore from Rs 200.6 crore. The presentation also recorded a foreign-exchange gain of Rs 57 crore in H1 FY27, compared with a Rs 17.6 crore gain in H1 FY26, while depreciation and amortisation rose to Rs 3.3 crore from Rs 3.1 crore.

On a standalone basis, PAT rose 28.6% to Rs 168.7 crore in H1 FY27 from Rs 131.2 crore. Standalone profit margin increased to 10.6% from 9.9%, while Q2 standalone PAT was Rs 89.4 crore, up 27.2% from Rs 70.3 crore. Consolidated PAT exceeded standalone PAT by Rs 26 crore during the half year.

How did WABAG’s cash and borrowing position change?

WABAG reported net cash excluding HAM of Rs 1,144.2 crore at Q2 FY27, up Rs 194.2 crore from Rs 950 crore at Q4 FY26. Cash balance excluding HAM increased to Rs 1,210.4 crore from Rs 1,059.1 crore over that interval, while borrowing excluding HAM fell to Rs 66.1 crore from Rs 109.1 crore. Management described Q2 FY27 as the 15th consecutive quarter of positive net cash.

The consolidated balance sheet reported cash and bank balances of Rs 1,217.2 crore at H1 FY27, compared with Rs 1,059.2 crore at FY26. It separately reported total consolidated borrowings of Rs 182.1 crore at H1 FY27, down from Rs 225.5 crore at FY26. These balance-sheet captions differ from the cash-and-debt table, which specifically excludes HAM from its cash, borrowing and net-cash measures.

Consolidated net cash generated from operations was Rs 224.6 crore in H1 FY27. Investing activities used Rs 64 crore and financing activities used Rs 75 crore, leaving cash and cash equivalents at the end of the period of Rs 875.5 crore. The presentation also lists full-year FY26 operating cash generation of Rs 206.7 crore, but that full-year figure is not a like-for-like comparison with the six-month H1 FY27 period.

What is WABAG targeting over the medium term?

WABAG’s stated three-to-five-year outlook calls for revenue compound annual growth of 15% to 20%, EBITDA margin of 13% to 15%, return on capital employed above 20%, return on equity above 15%, and a net-cash-positive position. The company also targets an order book equal to three times revenue and operations and maintenance, or O&M, revenue at 20% of total revenue within an asset-light model.

Against those targets, H1 FY27 consolidated revenue grew 20.3%, marginally above the upper end of the stated 15% to 20% range, and EBITDA margin was 13.8%, within the 13% to 15% range. The presentation reported return on capital employed of 20.5%, return on equity of 16.3%, and O&M at 18% of total revenue for H1 FY27. It also reported an order book of about Rs 20,200 crore, described as more than four times revenue.

Management attributed the revenue trend to efficient execution and new projects, and said the O&M focus was on track toward the outlook. The presentation’s future initiatives include a strategic tie-up with Peak Sustainability Ventures to establish 100 compressed biogas plants and a bio-gas-upgradation order on a build-operate-transfer model, where mobilisation activities had commenced. It also cited solar, semiconductor, data-centre and green-hydrogen water-treatment opportunities in India.

Conclusion

WABAG’s H1 FY27 figures show revenue, EBITDA and PAT increasing by 20.3%, 20.7% and 29.3% respectively, while the consolidated EBITDA margin held at 13.8% and the PAT margin rose to 10.3%. Its reported net cash excluding HAM reached Rs 1,144.2 crore as cash excluding HAM increased and borrowing excluding HAM declined from the FY26 position.

The next measures to watch are whether revenue growth remains within management’s 15% to 20% medium-term compound-growth range, whether the 13% to 15% EBITDA-margin target is maintained, and whether O&M progresses from 18% toward the 20% target. Management’s disclosed order book of about Rs 20,200 crore and the mobilisation of the bio-gas-upgradation project are the stated project and pipeline items that may inform those outcomes.