VA Tech Wabag, recognized for its prowess in water treatment solutions, has landed a groundbreaking order worth approximately $371 million (around ₹3,251 crore) for the engineering, procurement, and construction (EPC) of the Al Haer Independent Sewage Treatment Plant (ISTP) situated near Riyadh, Saudi Arabia. This significant contract marks another major milestone for the company within the Saudi market, aligning with the nation’s ambitious Vision 2030 initiative aimed at improving sewage treatment services across the Kingdom.
The ISTP project is being developed by a consortium led by Miahona Company, in collaboration with Marafiq and N.V. Besix S.A., for its off-taker, the Saudi Water Partnership Company (SWPC), the principal entity responsible for water and wastewater management projects in Saudi Arabia. The project will have a capacity of 200 million liters per day (MLD) and will include connections to necessary outfall delivery facilities.
Sivakumar V, Regional Head of Sales and Marketing at VA Tech Wabag, emphasized the importance of this project, stating, “This state-of-the-art technology order is a testimony to our technological superiority and commitment to delivering high-quality solutions worldwide. This order win marks another significant milestone for us in Saudi Arabia and reinforces our leadership position in the Middle East Region.”
Shareholders have reacted positively to the news, with VA Tech Wabag’s stock surging over 10% shortly after the announcement. Market analysts predict continued volatility, indicated by the stock's one-year beta of 1.4. The company has seen its stock price rebound significantly, rallying over 138% from its 52-week low of ₹650.05 recorded earlier this year.
The Al Haer ISTP project holds additional significance as it is part of Saudi Arabia’s broader Vision 2030 initiative, which aims to provide reliable sewage treatment services and improve the quality of life for residents. The project is expected to bolster the infrastructure necessary to support the increasing urban population and to address the challenges posed by rapid development.
Earlier this year, VA Tech Wabag also secured another significant project—a 20 MLD industrial wastewater treatment plant at the Ras Tanura Refinery Complex. Miahona Company led this project as well, demonstrating the growing collaboration between the various stakeholders involved.
Financial results for the company reflect this upward trend. For the quarter ending December 2024, VA Tech Wabag reported a consolidated profit after tax (PAT) of ₹70.2 crore, representing an 11.6% year-on-year increase. With revenues rising by 15.1% to ₹811 crore, the company’s operational metrics indicate strong continued growth following its successful order intakes.
The company's earnings before interest, taxes, depreciation, and amortization (EBITDA) stood at ₹105.1 crore, marking a growth of 6.3% from the previous year. Despite these gains, there has been some contraction with the EBITDA margin falling slightly to 13%.
VA Tech Wabag's stock, known for its resilience and capacity for rapid growth, has climbed nearly 99% over the past year, reflecting investor confidence amid the company’s strategic orders and financial improvements. These developments are likely to position VA Tech Wabag as one of the key players within the wastewater treatment industry not just locally, but regionally as well.
The latest order for the Al Haer ISTP is not just about the numbers; it signifies the potential for VA Tech Wabag to expand its footprint and influence throughout the Middle East. By investing in modern sewage treatment technology, the company aims to contribute toward sustainable urban development and improved public health standards.
With the swift advancements underpinned by Vision 2030, and VA Tech Wabag's active role within these plans, the future for both the company and the water treatment sector looks promising. The projects undertaken today are paving the way for smarter wastewater management solutions tomorrow, fundamentally altering how cities like Riyadh handle one of their most pressing infrastructure challenges.