Antony Waste Handling Cell Ltd Q1 FY27 Earnings Analysis

- Antony Waste Handling Cell Limited expects a 15% to 20% CAGR in revenue over the next 5 years, supported by a record Rs.18,000 crore order book. - Growth driven by strong execution in collection & transportation (C&T) and processing segments, with C&T revenue up 11% and processing up 5% in FY26. - Total municipal solid waste (MSW) managed increased 15% in FY26, with volumes rising 9% in C&T to 2.12 million tons and 19% in processing to 3.6 million tons. - New projects like two large waste-to-energy (WTE) plants in Andhra Pradesh are expected to contribute significantly post-FY29. - Increased volumes and new contract acquisitions, including Mumbai contracts and preprocessing facilities, contribute to near-term revenue growth. - Non-municipal revenue streams like RDF sales, compost, and EPR credits are expanding, providing further revenue diversification. - Execution timeline for the Rs.18,000 crore order book: 40% revenue over next 5-7 years, balance over 15 years.

- Antony Waste Handling Cell Limited targets a 15% to 20% revenue CAGR over the next 5 years backed by a record Rs.18,000 crore order book and new large-scale projects (Page 5). - EBITDA margins are expected to be maintained around 20-22%, supported by contractual escalations and disciplined cost management (Pages 4, 9). - PAT growth has been constrained due to higher interest and depreciation from capital-intensive WTE projects, but future WTE plants (post FY29) in Andhra Pradesh are expected to contribute positively to earnings (Page 9). - The company foresees an uptick in contract revenue and capex-induced revenue recognition mostly over FY27 to FY29, implying front-loaded growth in operating earnings during these years (Pages 10-12). - Dividend initiation signals confidence in financial health, supportive of sustained profitability (Page 3). - Overall, earnings growth is expected to accelerate post FY28-FY29 with full ramp-up of WTE assets and scaling of new contracts.

- Incremental capex of approximately Rs.750 crores planned primarily for processing contracts, including: - Atkoli processing facility - Two Waste-to-Energy (WTE) projects in Andhra Pradesh - Two Collection & Transportation (C&T) contracts in Mumbai - The Rs.750 crores capex will be split over 2 years, with about 40% in FY27-FY28 and 60% in FY28-FY29. - Total capex of Rs.650-700 crores expected to be captured as contract revenue/costing over 2 to 2.5 years. - Future projects include: - Three C&T contracts in northern India currently in bidding - One WTE project under consideration in southern India - Strategic partnership with Japan's JFE Engineering for WTE development enhances technology edge and cost certainty. - No immediate investment planned in auto tire recycling/scrappage business due to market stabilization wait-and-watch approach.

- Currently, the company is in a strong financial position with a net debt to equity ratio of just 0.3x and gross debt at approximately Rs.426 crores as of March 2026. - The weighted average cost of debt is around 9.9%, and ratings are solid (A- for key subsidiaries and BBB+ for the listed entity). - This strong balance sheet and low leverage provide enough firepower to raise more debt for upcoming projects, which have assured revenue streams and long-term contracts. - No explicit mention of equity fundraising was made during the call. - The company plans to fund incremental capital expenditure (~Rs.750 crores) mainly through debt for new waste processing and WTE projects over the next 2-3 years. - The strategy reflects disciplined borrowing mainly to support expansion while maintaining a healthy cash cushion for future projects.

- Antony Waste Handling Cell Limited's order book as of March 2026 stands at an all-time high of Rs.18,000 crores, providing strong revenue visibility. - The Rs.18,000 crores order book split: approximately 60% processing contracts and 40% collection and transportation (C&T) contracts. - The company expects to execute about 40% of this order book revenue over the next 5 to 7 years, with the remaining spread over the next 15 years. - Incremental capex of around Rs.750 crores is required mainly for processing contracts, including new projects like Atkoli processing and two waste-to-energy (WTE) projects in Andhra Pradesh, plus two C&T contracts in Mumbai. - Mumbai C&T projects alone represent a revenue stream of around Rs.1,330 crores spread over 7 years, averaging Rs.190 crores per year. - The company is also bidding for 3 C&T contracts in northern India and one WTE project in southern India, indicating an active order pipeline.