KEC's Q1FY21 revenues came in at Rs. 2206.8 crore, down 8.5% YoY. This was better than our estimate of Rs. 1566.5 crore. During Q1FY21, the overall T&D business revenue declined 9% YoY to Rs. 1454 crore, in which SAE division declined by 9% to Rs. 278 crore. The railways business revenue came in flat at Rs. 521 crore while civil business segment revenue registered growth of 58% YoY to Rs. 103 crore. Cables business fell 39% to Rs. 159 crore, YoY. EBITDA margins came in above our estimate at 8.8%, down 160 bps YoY. During Q1FY20, KEC's order inflow came in at Rs. 1931 crore while the FY20 order book was at Rs. 19682 crore.
Valuation & Outlook
KEC delivered an overall decent performance across segments for Q1FY21 with execution pick-up, despite Covid-19 disruptions, and reasonable order inflows, mainly in the international T&D segment. Efficient working capital management and execution ramp up despite challenges should comfortably ensure 9.6% revenue CAGR in FY20-22E. We value KEC at 12x FY22E EPS with a revised target price of Rs. 340/share and change our rating from HOLD to BUY. Key risk: execution delays, stress on working capital.
For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_KECIntl_Q1FY21.pdf
Shares of KEC INTERNATIONAL LTD. was last trading in BSE at Rs.292.45 as compared to the previous close of Rs. 273.95. The total number of shares traded during the day was 140629 in over 5647 trades.
The stock hit an intraday high of Rs. 295 and intraday low of 275.75. The net turnover during the day was Rs. 40842337.