Kalpataru Projects International Ltd. share price target

We maintain our BUY rating on the stock.

Kalpataru Projects (KPIL) reported a broadly in-line revenue growth of 16% YoY, while its EBITDA/PAT grew 17%/9% YoY. PAT was hit by higher-than-expected interest expenses, as the collections from Water projects continued to be delayed.

We continue to remain positive on Kalpataru Projects International (KPIL) based on its positioning across fast-growing power T&D EPC as well as the Buildings and Factories (B&F) segment.

We initiate coverage of Kalpataru Projects International Ltd (KPIL) with a BUY recommendation and a target price of Rs 1,590/share, implying an upside potential of 25% from the CMP

Kalpataru Projects’ (KPIL) 2QFY25 revenue was in line with our estimate. KPIL reported a revenue growth of 8% YoY, while EBITDA/PAT grew 13%/17% YoY.

? KPIL’s standalone revenues growth of 7.6% led by strong growth in T&D business (25%), Oil & Gas (170%), Urban Infra (31%) and B&F (19%) but was compensated by a decline in water (43%) and Railways (40%). Results broadly met estimates.

We maintain a Buy on KPIL for a price target of Rs. 1,570 factoring in the incremental order inflows and divestment triggers. KPIL trades at 29x/21x/18x its FY2025/2026 EPS, respectively.

We reiterate our BUY rating on Kalpataru Projects International (KPIL), with SOTP-based target price of Rs1,550/sh (Unchanged).

We maintain our BUY rating on Kalpataru Projects International (KPIL), with revised up TP of Rs1,550/share (Rs1,400/share earlier), mainly led by 8%/11% increase in execution.

The Bharatiya Janata Party (BJP)-led National Democratic Alliance (NDA) has
retained power for the third consecutive term, albeit with a narrower majority
(293 seats) than expected.

KPIL’s 4QFY24 result was slightly lower than our estimates. Revenue/EBITDA/PAT
grew 17%/29%/52% YoY in 4Q. Revenue growth was led by healthy project execution in the T&D, water and urban infra segments.

Kalpataru Projects International’s (KPIL) Q2FY24 result witnessed a steady performance with i) healthy execution across majority of businesses, except railways and oil & gas, ii) stable net debt due to focused working capital management, and iii) robust OI during H1FY24 and strong tender pipeline going ahead.

Kalpataru Projects International’s (KPIL) Q1FY24 performance was healthy with standalone revenue/EBITDA growth of 15%/17% YoY to INR 16.1bn/ INR 3.1bn, respectively. PAT was lower YoY at INR 1.3bn on account of a decline in other income (last year included dividend from subsidiaries) and increase in depreciation (+41% YoY) on higher capex in FY23.

Kalpataru Power (Kalpataru) is reinventing itself into a global EPC company from a focused T&D player with presence in diversified geographies and diversified segments. It has been entering, building and scaling up new EPC segments over the last few years.