VA Tech Wabag's ₹2,332 crore Saudi order cancelled; company seeks clarity

VA Tech Wabag informed exchanges on Saturday, November 14, that the tender for its approximately ₹2,400 crore desalination project in Saudi Arabia has been cancelled by the customer, Saudi Water Authority, citing internal reasons.In an exchange filing, the water treatment company said it had received the award for executing a 300 million litres per day mega seawater desalination plant at Yanbu, Saudi Arabia, in July 2025. Following the award, Wabag completed the necessary formalities and executed the contract, which was submitted to the customer for its counter-signature and formal commencement of the project.However, Saudi Water Authority has now notified all tender participants through the Kingdom's Etimad electronic government procurement and tendering platform that the tender has been cancelled due to internal reasons attributable to the customer.Also read: YES Bank denies ₹32 crore cyber fraud report, says no government accounts affectedWabag said it is approaching the authority to understand the reasons behind the cancellation in greater detail and determine the next course of action.The project involved the design, engineering, supply, construction and commissioning of a 300 MLD desalination plant at Yanbu on Saudi Arabia's west coast. The contract was valued at around $272 million, equivalent to 1.019 billion Saudi riyals or about ₹2,400 crore.At the end of Q2 FY27, VA Tech Wabag's order book stood at ₹20,200 crore, equivalent to around 4.7 times its trailing 12-month revenue, providing strong revenue visibility for the coming years.The latest development follows an earlier cancellation of a similar 300 MLD desalination project in Saudi Arabia in December 2024.

At the time, the Saudi Water Authority had informed all tender participants that the tender had been cancelled due to internal administrative procedures.Wabag Q2 results and FY27 outlookVA Tech Wabag reported revenue of around ₹1,000 crore and profit after tax of ₹104 crore in Q2FY27, with margins at 14.4%.CFO Skandaprasad Seetharaman expects FY27 revenue growth to be at the higher end of the company's 15-20% guidance, with scope to exceed it if anticipated orders materialise. The order book has crossed ₹20,000 crore, compared with ₹7,000-10,000 crore earlier."We are very confident with the order book as well as the bid pipeline; the year should also be strong," Seetharaman said.The company expects to maintain margins in the 13-15% range, while prioritising profitable growth and cash generation.Shares of Va Tech Wabag ended 1.8% lower on Friday, at ₹2,043. The stock has advanced more than 55% so far in 2026.