Va Tech Wabag jumps on securing financial closure of HAM project

Va Tech Wabag spurted 4.55% to Rs 252.75 after the company said it has completed the financial closure for its hybrid annuity model project received from Bihar Urban Infrastructure Development Corporation (BUIDCO).

Earlier, Wabag secured a contract worth Rs 1,187 crore order from BUIDCO under the National Mission for Clean Ganga (NMCG) scheme to develop sewage treatment plants (STPs) of 150 MLD capacity along with sewerage network of over 453 km in the Digha and Kankarbagh zones of Patna, one of the most populous cities on the banks of River Ganga.

To meet the project debt funding requirement, Wabag has partnered with PTC India Financial Services, a leading financial institution in the infrastructure space. With this, WABAG has successfully achieved the financial closure of its second HAM project within this financial year.

In a separate announcement, Va Tech Wabag said its board has approved the investment in DK Sewage Project (DKSPPL), a wholly owned subsidiary of the company. DKSPPL was incorporated for setting up of STPs in Digha and Kankarbagh in Bihar ("BUIDCO Project"). The company intends to make further Investment in DKSPPL for the purpose of financing of the BUIDCO Project. Wabag will invest upto Rs 29 crore, in one or more tranches, by way of equity shares, compulsorily convertible preference shares, and convertible/non-convertible debentures.

VA Tech Wabag designs and builds water and sewage treatment plants. Its consolidated net profit soared 34.7% to Rs 38.04 crore on a 17.2% surge in net sales to Rs 796.02 crore in Q3 December 2020 over Q3 December 2019.

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