Water distribution and recycling stocks experienced significant selling pressure during Wednesday's trading session, with shares declining up to 5.6%. According to reports from Live Mint, the sector faced heavy selling pressure as investors engaged in small-cap profit booking for the second consecutive session. The decline affected major players including Concord Enviro Systems Limited, EMS Limited, Taylormade Renewables Limited, VA Tech Wabag Limited, and Ion Exchange India Limited.
Concord Enviro Systems emerged as the worst performer, trading 5.69% lower at ₹260.95 per share on BSE at 2 pm on Wednesday. EMS Limited stock declined 3.5% to ₹360.8 per share, while Taylormade Renewables share price fell 4.83% to ₹56 per share. VA Tech Wabag shares were trading 2.4% lower at ₹2052.75 per share, and Ion Exchange India stock declined 1.27% to ₹426.05 per share. As reported by Live Mint, these declines represent the second consecutive session of profit booking in the small-cap segment.
According to Tushar Badjate, Director of Badjate Stock & shares Pvt Ltd, as reported by Live Mint, water stocks are falling due to broader small-cap profit booking and continuing concerns over slower government payments during the Jal Jeevan Mission 2.0 transition. The transition requires states to clear reform conditions before funds are released, creating uncertainty in the sector. Despite short-term challenges, experts remain constructive on the sector while maintaining selectivity in stock choices.
As reported by Live Mint, experts remain constructive on the sector while preferring quality names over broader exposure. Tushar Badjate highlighted that the long-term theme remains strong with JJM extended to 2028 and ₹8.7 lakh crore outlay. He recommended VA Tech Wabag due to its strong Q1 performance and ₹17,200 crore order book, along with global desalination exposure. For Ion Exchange India, he suggested buying on dips, while cautioning on EMS due to payment-cycle risks and Concord Enviro and Taylormade due to weak earnings performance.
According to Gaurav Garg, Head - Research at Lemonn, as reported by Live Mint, geopolitical tensions like the West Asia crisis can impact these sector companies' growth outlook. He noted that de-escalation since the April ceasefire has reopened the Gulf awarding pipeline, with Wabag converting this opportunity into a maiden mega desalination order in Kuwait and a large plant in Ajman. For companies like Wabag, corrections change price rather than the underlying thesis, suggesting long-term fundamentals remain intact despite short-term volatility.
