“It’s tough, I barely have time”, says Carlos Piani, Sabesp’s CEO and retired Judo wrestler, when asked about hobbies while not leading the largest sanitation company in Brazil.

Multidisciplinary executive with over 20 years of experience, Piani hasn’t wrestled for years, but still maintains resilience and perseverance, pillars of the martial art, which preach that the fighter should learn to rise again stronger after each challenge.

“Part of my personal interest in being here is to use all that I’ve learned. To enjoy the good things and avoid the mistakes of the past. Mistakes do happen, sadly. But we must make use of every experience to be the most effective we can in this journey”, affirms.

His challenge in the newly private firm is as difficult as a good Ippon in Judo. He must execute an audacious plan worth 70 billion Brazilian reais to achieve the goal of universal sanitation by 2029 – an undertaking never before attempted on such a large scale and within such tight time constraints by any other Brazilian company. In parallel, Piani promotes a cultural shift within the company, which was state-affiliated for 51 years, until it became private in July 2024.

The state government of São Paulo has sold 32% of its Sabesp shares for R$14.8 billion, with 15% of the proceeds going to Equatorial, the reference shareholder, and 17% to stock investors.

The focus is on efficiency and returns for the society and shareholders. The CEO sees the uniqueness of his work as fuel to keep moving forward. “I am pleased and excited, despite the herculean challenge, to reach universal sanitation in São Paulo and make Sabesp one of the biggest companies in the world”, he says. This endeavor is already showing results.

Piani took charge in October 2024, after leaving Equatorial’s executive board. From the start, he has accelerated a process that began in the previous year, proposed by his predecessor, André Salcedo: To transform Sabesp into a single company. The firm used to operate in a model of regional branches with autonomy to implement different processes and techniques. “At the time, it was as if state-affiliated Sabesp was a holding of many smaller companies”, affirms—a sign of lack of patterning and, many times, of efficiency.

The institutional reorganization occurred in 2023, with the creation of directories, adopting a model closer to that of a private company, which had already aimed to go private at the beginning of the Tarcísio de Freitas government.

There was, however, no time for this change to reach the top, the operating hub where everything happens in basic sanitation. A problem that was swiftly solved in October last year, resulting in greater efficiency. “In some places [patterning of the technical area] can reduce costs, and in others, increase them. But patterning will bring overall greater efficiency”, states.

Additionally, the company reviewed outdated practices that were no longer required from a regulatory standpoint and, in the eyes of the current administration, had no logical connection to financial results.

One of them was the discounting of tariffs for big clients, such as shopping malls and industries. It was over 800 million reais a year that would result in profit losses due to a regulatory gap.

By the end of 2024, contracts with 555 companies were broken. “We brought back the profits Sabesp is rightfully entitled to. This contributed to the results at the end of the year”, affirms Piani.

The situation was taken to court by customers, but the company says that 70% of the lawsuits had a favorable outcome for Sabesp. A new cycle of discount reviews is expected to take place later this year, potentially generating more revenue. In addition, the state government is expected to define a discount policy for large consumers which, as is the case for low-income citizens, will take the form of public policy — in other words, funded by the state.

The charging of owing clients and the combat against illegal connections were also pillars for last year’s results. This was added to the Voluntary Resignation Plan, which saw the adhesion of 2,039 employees in 2024, generating some relief to the company's pockets worth R$439 million.

“We are more disciplined and stricter in these fronts. Always looking for more discipline in the financial area and operational part”, affirms Piani. This accelerated endeavor, which lasted for three months in 2024 and into 2025, in addition to the legacy of a textbook transition, has made Sabesp the winner of MELHORES E MAIORES (Best and Biggest)’s 52nd edition.

The company became a case study in the modernization of the Brazilian public sector. The landmark year has had expressive numbers. In 2024, Sabesp reported a net revenue of 36.1 billion reais, representing a 41.3% increase from 2023.

The EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortization) totaled $ 11.3 billion, representing a 19% increase, with the EBITDA margin adjusted to 52%, four percentage points above the 2023 level.

Net profits, however, skyrocketed, reaching 9.5 billion reais —an increase of 171.9% compared to the previous year’s 3.52 billion. Analysts believe that part of this result stems from the significant reduction in costs.

However, a significant portion of these results is related to the single contract between the company and all municipalities in São Paulo, which was conceived during the privatization process. Previously, each of the 371 cities had contracts with different rules and maturities.

With the legal certainty of a single instrument until 2060, Sabesp updated the history of reversible and non-amortized investments until the end of the contract, which should be compensated to the company, a standard in sanitation and electricity concessions.

This generated a positive impact of R$5.4 billion on profits. In other words, investments, such as significant construction projects, will depreciate over time but will be returned to the company in part, which is reflected in the balance sheet.

When privatization took place and regulatory agreements were solidified, in addition to the fact that the new contract was much better than the old ones, the company felt comfortable recognizing this in its revenue," says Antonio Junqueira, an analyst at BTG Pactual (part of the same control group as EXAME).

Despite recognizing the relevance of this in the numbers of the previous year, Junqueira shows that, by removing this accounting adjustment, Sabesp has maintained positive results, thanks to an increase in efficiency. “The company has been improving; the previous administration has done a good job. And, even without this adjustment, the numbers of 2024 are still better than those of 2023”, says the analyst.

The appreciation was immediate. Shares rose 20.51% last year, reaching R$85.63, and the company's market capitalization reached R$60.4 billion as of December 2024.

The rally did not end there and continues into this year. In 2025, the stock closed at R$122 in August, close to the value projected by analysts during the privatization process. The company reached a record market value of R$83 billion, an increase of R$13 billion in just eight months and R$45 billion since 2023, when Governor Tarcísio de Freitas first signaled that privatization would take place.

Of the 12 research firms that follow Sabesp, more than half recommend buying the stock.

“It's an impressive success story. Investors are certainly pleased with this stock. And the company still has a lot to do,” says Junqueira, from BTG. The dividend policy is linked to universalization goals. The distribution of up to 100% of net income will only be allowed starting from 2026, provided compliance with the established plan is met.

Not surprisingly, Piani says that universalization is the company's number one, two, three, and four priority. “That's why the government went through the whole process. And we will fulfill that obligation,” he says.

The big challenge is the speed required for contracting. The company reinforced its purchasing team, hiring more than 100 people, and transformed the division into a board of directors. The result was a threefold increase in the speed of contracting works compared to the state model.

More than R$10 billion has already been invested since privatization, and 60% of the total R$70 billion has already been contracted, most of it via credit. “We have a collection of alternatives for raising funds. It will be mainly through debt, credit, and our own generation, and we can tap the capital market, if necessary”, says Piani.

The regulatory target is monitored annually. For the accumulated total for 2024 and 2025, the good news is that the target for connecting homes to the water supply has already been exceeded.

The major challenge lies in sewage collection and treatment, whose targets are only expected to be met by the end of this year. “The path is critical in the metropolitan region, due to the complexity of urbanization,” says the executive. Approximately 20% of the population in the state lacks access to sewage treatment. The challenge is greater due to the inclusion of 1 million informal and rural residences, which were not included in the contract before privatization.

Progress involves increasing the capacity of treatment plants, such as the one in Barueri, the largest in South America, which is equivalent in size to 80 soccer fields and is responsible for treating 60% of the sewage in Greater São Paulo.

The idea is to increase its capacity by almost 75%, to 20 cubic meters of treated waste per second. "These are two- to three-year projects. To achieve universal coverage, we have to start now," says Piani. All this effort, in addition to pleasing shareholders, has a direct impact on society.

With a 30% weighting in the EXAME MELHORES E MAIORES 2025 ranking methodology, ESG is intrinsic to the DNA of a sanitation company.

“In addition to bringing investment and development, sanitation brings health and dignity and reduces income inequality,” says the CEO. Data from Instituto Trata Brasil indicate that the lack of sanitation reduces the income of future generations by 46%. However, estimates suggest that achieving universal access by 2040 would result in a gain of R$22 billion per year for the Brazilian economy. “If we deliver results with purpose, it will be a very different case for Brazil. Generating value for shareholders but delivering purpose and well-being to the population. That is our mission,” says Piani.

Beyond the goal, Sabesp sees a myriad of opportunities. At an event at B3, which marked the end of the privatization process in June of last year, Governor Tarcísio de Freitas stated that the company was ready to take flight and become the largest in the world.

Piani shares this conviction. The CEO is betting on the massive adoption of technology in the operation to bring more efficiency. For this reason, he merged the customer service, technology, and innovation departments into a single department.

One example was the purchase of 4 million smart water meters from telecom company Vivo, in an investment of R$3.8 billion, the most significant innovative metering project underway in the global sanitation market.

Ultrasonic technology provides real-time data, enabling better response times in the event of leaks and other incidents. “If we are more efficient, rates can be more prudent and fairer. Part of Brazil's productivity challenge also involves public services. And we will do our part,” says the CEO.

The expansion plan also includes participation in sanitation auctions nationwide. Six auctions are planned for 2025 alone, with estimated investments exceeding R$50 billion.

The primary focus for Sabesp is the 218 cities in São Paulo that are not served by the company, with estimated investments of R$20 billion over the course of the contract.

“We are looking at all opportunities,” says Piani. For him, the probability of a transaction occurring today is lower than it will be in five years, when the challenge of universalization will be complete. However, he says it is not a question of “if,” but “when” Sabesp will participate in auctions. “Whether here in the state of São Paulo or even outside, Sabesp will be part of this story when the right opportunity matches our timing,” says the CEO. Brazil will be watching closely.