KEC International Ltd. share price target

We expect Revenues/EBIDTA/PAT to grow at CAGR of 11%/10%/21% respectively over FY20-22E and value KEC International at 13X FY22E EPS of Rs 32 to arrive at a target price of Rs 415.

Order inflow environment improving: The momentum of order wins has continued in this quarter, with KECI winning ~INR25b worth of orders, including the recently won order worth ~INR10b. Notably, order inflows have commenced in the Railways segment and are likely to pick up hereafter. 9MFY21 order wins (to date) amount to ~INR68b. Although this is below INR98b worth of orders won in 9MFY20, we attribute the wins to large firsttime orders in the Civil segment in the base year as the company had forayed into metros (Kochi and Delhi metro orders). The order inflow momentum is picking up as we enter a busy season in terms of construction...

We retain a Buy on KEC International Limited (KEC) with an unchanged PT of Rs. 435, considering its improving operations and reasonable valuations. Pick-up in execution would ensure better performance in FY2021. Strong YTD order inflows and a Rs. 30,000-crore bidding pipeline offer visibility for remainder of FY21. Expect 1.4x and 2.5x y-o-y rise in revenue for rail and civil in FY2021. Rail division continues faster execution, while order tendering is gaining traction for railways and tendering in T&D; is largely dominated by international market. YTD collections better than last year. Interest outgo contained with lower rate debt....

KEC's 2QFY21 revenues came in at 32.6bn, up 16% YoY and 47.6% QoQ. The growth was mainly driven by faster ramp-up in execution, increased labour strength and adoption of mechanization, automation and digitalization to improve productivity. EBIDTA margins declined to 9% (vs. 10.5% in...

We recommend a BUY on KEC International with a Target Price of Rs 360 an upside of 8% from CMP of Rs. 334 (pre-open price) and Stop Loss Rs 324.

Oil and Gas infrastructure etc. We have revised our estimates upwards and expect the company to post Revenues/EBIDTA/PAT at CAGR of 11%/10%/21% respectively over FY20-22E. We retain BUY with a revised target price of Rs 415 valuing the company at 13x FY22E.

Topline came in at | 3257.7 crore, up 16% YoY (above our estimate of | 2875.8 crore). During Q2FY21, the overall T&D; business (including SAE Tower) revenue remained flat YoY at | 1977 crore. While non-T&D; business (railways, civil, cables, other) registered robust growth of 52% to | 1349 crore, YoY led by better execution. The railways business revenue came in at | 821 crore, up 45% while civil business segment revenue grew 3x to | 212 crore. The company has bagged orders to the tune of | 4366 crore. KEC has submitted tenders to the tune of | 30000 crore with more worth...

KEC has reported Q2 revenue, EBIDTA and PAT better than estimates (Refer Exhibit 1), with supply chain and labor levels back to normal. Order inflow for YTDFY21 was Rs43.7bn, with 41% domestic orders. Its...

stable working-capital cycle give us the required assurance of strong future execution and earnings. We roll over our estimates to FY23 and expect 12%/17% revenue/PAT growth y/y. We value KEC at 13x FY23e EPS, with...