After VA Tech Wabag secured an O&M contract worth ₹121 crore for a wastewater treatment plant in Bahrain, increasing its position in the Middle East, its shares increased by more than 7%. Despite recent dips, the company’s stock has remained strong, quadrupling from its 52-week low.
After a significant operations and maintenance (O&M) contract worth ₹121 crore was announced on Wednesday, January 29, shares of VA Tech Wabag, a substantial stock in Rekha Jhunjhunwala’s portfolio, increased by more than 7%.
To further solidify its position in the Middle East, the business was awarded a seven-year contract to run a wastewater treatment facility in Bahrain. BAPCO Refining’s order expands VA Tech Wabag’s already-existing foothold in the nation, where it has been operating a sewage treatment plant since November 2018.
As of the December 2024 quarter, Rekha Jhunjhunwala, the late investor Rakesh Jhunjhunwala’s widow, owned 50 lakh shares in VA Tech Wabag, or 8.04 percent of the company.
Strengthening Middle East Presence:
According to VA Tech Wabag, the new contract strengthens its leadership in the O&M industry and further confirms its position in the Middle East. Advanced Membrane Bioreactor (MBR) technology at BAPCO’s Industrial Wastewater Treatment Plant (IWTP) refinery ensures high-efficiency wastewater treatment while meeting strict industrial and environmental regulations. The plant can handle 4,400 US gallons of industrial wastewater per minute (USGPM), demonstrating the company’s proficiency in managing large-scale projects.
The firm has been involved in the operation of the 40 MLD Madinat Salman Sewage Treatment Plant in Bahrain since November 2018.
“This deal demonstrates our technological know-how and capacity to provide top-notch water solutions, especially in the oil and gas industry. We value BAPCO’s faith in our talents,” stated Srinivasan K, General Manager of WABAG’s Regional Headquarters in the Middle East.
Stock Price Movement:
After the news, intra-day trading saw a 7% increase in VA Tech Wabag’s stock price to ₹1,298.45. Despite the rise, the stock is still 33% behind its peak of ₹1,943.95, reached in December 2024. But it has proven remarkably resilient, tripling from its January 2024 52-week bottom of ₹647.60.
VA Tech Wabag has produced an 88 percent return in the last 12 months. It has recently encountered significant challenges, dropping 21.5 percent in January, following an 8.5 percent decline in December 2024.
In addition to the Bahrain contract, VA Tech Wabag has recently received other noteworthy orders:
- The order from Chennai Petroleum Corporation Ltd. (CPCL): The business was awarded a ₹145 crore order by CPCL earlier in January to design, develop, supply, fabricate, install, and commission desalination water pipelines that connect the CPCL desalination facility at Kattupalli with the CPCL Manali Refinery. Within a year, the project should be finished.
- Zambia’s Lusaka Water Supply Project: A €78 million (about ₹700 crore) deal from Zambia’s Lusaka Water Supply and Sanitation Company was announced by VA Tech Wabag in December 2024. Its foreign business portfolio has grown significantly with this deal.
