Should You Invest in Antony Waste Handling Cell Ltd. for the Long Term? Stock Analysis by Finology

​​​​​Antony Waste Handling Cell Ltd., India’s leading Municipal Solid Waste (MSW) management company, has delivered revenue and profit growth of over 25% CAGR in the last five years.

Finology Research Desk has analysed the company this week, providing a clear verdict on whether Antony Waste Handling Cell Ltd. is a good long-term stock or not. Find out in this article.

What makes the Indian Waste Management Industry special?

The Indian municipal solid waste management industry is valued at USD 7.85 billion in 2025 and is projected to grow at a CAGR of ~5.72%, reaching USD 10.37 billion by 2030, driven by government initiatives emphasising cleanliness and sanitation, an increase in waste generation, rapid urbanisation, and technological advancements.

Source: Mordor Intelligence

According to The Energy and Resources Institute (TERI), India ranks among the top 10 countries globally in municipal solid waste (MSW) generation, generating over 62 million tons of waste annually. Of this, 43 million tons are collected, but only 12 million tons of the collected waste are treated before disposal, while the remaining 31 million tons are dumped in waste yards. Approximately 19 million tons of waste are never collected. This gap in collection and treatment has created serious environmental and public health challenges. According to projections by the Indian Central Pollution Control Board (CPCB), annual waste generation in India is expected to surge to 165 million tonnes by FY30.

The municipal solid waste management industry in India comprises both the organised and unorganised sectors. The organised sector consists of larger private firms operating under long-term agreements with city municipalities, handling waste collection, transportation, processing, waste-to-energy projects, and landfill management. The unorganised sector, on the other hand, includes around 2.2 million individuals, mostly informal waste pickers, who play a vital role in recycling by collecting an estimated 15-20% of urban municipal solid waste. They are primarily engaged in the segregation and recycling of plastics, paper, metals, and glass, making the unorganised segment dominant in terms of manpower.

Beyond collection and disposal, the MSW management industry spans several verticals, including recycling, resource recovery, composting, waste-to-energy, landfill remediation, etc. The government, through the Swachh Bharat Mission, aims to scientifically process all Municipal Solid Waste (MSW) generated in the country. It is pushing for innovative solutions to develop newer scientific approaches for waste management, while prioritising safer disposal methods, thereby opening opportunities for technology-driven companies.

Business model of Antony Waste Handling Cell Ltd.

Founded in 2001 by Jose Jacob Kallarakal, Antony Waste Handling Cell Ltd. is engaged in the business of providing end-to-end municipal solid waste (MSW) management services. Its operations span three key areas: collection and transportation (C&T) of waste from households, slums, and commercial hubs; processing and segregation of waste into compost, recyclables, or refuse-derived fuel (RDF), along with conversion of waste into energy; and mechanised sweeping of urban roads, followed by safe disposal of the collected waste. With more than 23 years of experience, the company works primarily with municipalities across India and ranks among the top five players in the country’s MSW management industry.

 

Source: DRHP

Revenue mix of Antony Waste Handling Cell Ltd.:

 

Source: Investor presentation Q4 FY25

Antony Waste Handling Cell reported a consolidated revenue of Rs 959 crore in FY25, with MSW collection & transportation continuing to be the primary revenue driver at 61%. MSW processing accounted for 27% of its revenue, while contracts and others, including mechanical and manual sweeping of streets and the sale of scrap, contributed the remaining 12%.

Unit economics of Antony Waste Handling Cell Ltd.:

Source: Investor presentation

Project expenses fell by 35% from Rs 40 crore in FY24 to Rs 26 crore in FY25, mainly because its Kanjurmarg project with Municipal Corporation of Greater Mumbai (MCGM) has completed the construction and development work and has moved into its operating phase, leading to lower expenses. The project is structured on a Design, Build, Own, Operate and Transfer basis, where the company builds and operates the facility for 25 years before transferring it back to MCGM.

Employee benefit expenses rose marginally at 27% from Rs 268 crore in FY24 to Rs 291 crore in FY25. As a share of total income, these costs have remained around 25% to 32% of the total revenue over the past five years.

Finance costs increased 40% YoY from Rs 40 crore inFY24to Rs 56 crore in FY25, driven by higher borrowings during the year, which went up from Rs 307 crore in FY24 to Rs 331 crore.

Depreciation and amortisation expenses rose from Rs 53 crore in FY24 to Rs 70 crore in FY25, marking a 32% increase. The rise was largely driven by recent capex on processing units, which has expanded the asset base. Over the last five years, these expenses have ranged around 5% to 7% of the total income.

Other expenses (adjusted for exceptional items), the largest component of the company's cost structure, rose slightly from Rs 385 crore in FY24 to Rs 398 crore in FY25. These include power & fuel, repair and maintenance, rent, mining expenses, vehicle hiring charges for garbage collection, etc and have accounted for roughly 38% to 43% of total income over the past five years.

Tax expenses for FY25, based on an effective corporate tax rate of around 25%, stood at Rs 26.61 crore, down from Rs 29.21 crore in FY24. However, the recognition of deferred tax assets lowered the overall tax charge, resulting in a net tax expense of Rs 18 crore.

After accounting for all expenses, the company reported a net profit of Rs 101 crore in FY25, up just 1% from the previous year. However, the net profit margin fell from 11.2% in FY24 to 10.53% in FY25, mainly driven by higher depreciation and finance costs.

Porter’s five forces analysis of Antony Waste Handling Cell Ltd.

 

Source: Finology research desk

1. High bargaining power of customers: The bargaining power of Antony Waste’s customers is very high. Its primary clients are municipal corporations that are highly price sensitive. Contracts are awarded through competitive bidding that often favours the lowest qualified bidder, creating strong pressure on margins. Also, at renewal, municipalities hold all the power and can easily replace Antony Waste Handling Cell if a competitor offers a lower price.

2. Moderate threat of suppliers: The bargaining power of suppliers for Antony Waste Handling Cell is moderate. The company procures key requirements such as vehicles and specialised equipment from leading international suppliers, including Compost System GmbH, Bucher Industries, Karcher, etc. Dependence on a limited pool of such specialised vendors gives these suppliers some influence. However, the availability of alternative suppliers in certain categories prevents overall supplier power from becoming too strong.

3. High competition in the industry: Competition in the municipal waste management industry is intense, with a few large players like Ramky Enviro Engineering, Urban Enviro Waste Management and Antony Waste Handling Cell vying for a limited number of high-value municipal contracts. The scarcity of opportunities, combined with price-focused bidding, triggers intense price wars in this industry.

4. Low threat of substitutes: The threat of substitutes in municipal solid waste management is very low, since the collection and disposal of a city’s waste is an indispensable service with no viable alternative. What varies is the method of treatment being used, such as advanced processing or landfilling techniques. Antony Waste Handling Cell reduces this risk by investing in multiple technologies, ensuring it stays competitive and compliant with government regulations.

5. Moderate threat of new entrants: The threat of new entrants in the waste management sector is moderate. High capital requirements for vehicles, processing plants, and landfill sites act as a barrier for smaller players. Also, navigating strict environmental regulations and securing contracts requires expertise and a proven track record. Still, the threat remains moderate, as large conglomerates with deep financial pockets can enter the market easily.

What led us to reject Antony Waste Handling Cell Ltd. for Finology 30?

1. Revenue concentration risk: Antony Waste Handling Cell’s revenue base is highly concentrated, with its top three customers contributing nearly ~49% in FY24. Most of its business comes from government contracts, awarded through tenders, typically to the lowest qualified bidder and are renewed at the discretion of municipal bodies. Most of these contracts are concentrated in or near Mumbai, including clients such as Municipal Corporation of Greater Mumbai, Navi Mumbai Municipal Corporation, Thane Municipal Corporation, New Okhla Industrial Development Authority, and Pimpri Chinchwad Municipal Corporation. This exposes the company to constant pricing and margins pressure as well as renewal risk. This combination of customer concentration, pricing pressure and renewal uncertainty makes the company highly vulnerable to contract losses.
2. High receivable days: The company operates in an industry that already requires heavy working capital, yet its cycle remains stretched at ~90 days, with average collection periods exceeding 120 days over the past three years. A large portion of their revenue comes from municipal corporations, which exposes the company to significant collection risk. As of Dec 31, 2024, around Rs 135 crore of receivables (after adjusting for provisions) remained overdue for over six months, indicating significant collection delays and making the company highly vulnerable to liquidity pressures.

The Bottom Line

For Finology 30, our ideology has been to focus on business models with a strong moat and strong management pedigree. For now, Antony Waste Handling Cell Ltd. has failed to pass our investment checklist. So, for now, we decided not to go ahead with Antony Waste Handling Cell Ltd.

However, there are very few stocks that made it to Finology 30. Check them out here.