KEC International Ltd. share price target

EBITDA margin improved by 48bps YoY to 10.6% while PAT growth was flat due to rise in interest expenses and fall in other income. We reduce FY19/20E revenue estimate by 3% & 2% respectively on account of slower order inflow in FY19. Rising opportunity in international T&D; & strong execution in railway, cable & civil business will support earnings and we value KEC at a P/E of 10x on FY21E EPS and retain Accumulate' rating. Non T&D; segment continued to support the top-line...

ICICI Securities Ltd | Retail Equity Research KEC reported Q3FY19 results that were below our estimates. KEC continued its strong performance in railways and civil business while T&D; business growth remained sluggish Revenues were at | 2646.6 crore up 10% on a YoY basis, below our estimate of | 2715.9 crore. T&D; business grew marginally by 2.0% to | 1563 crore while railways & civil segments reported revenues at | 551 crore, up 164.6%, and | 110 crore, up 27% YoY (amid low base),...

KEC International Limited (KEC) is a global infrastructure Engineering Procurement and Construction (EPC) major. It has presence in the verticals of Power T&D;, Cables, Railways and Water & Renewable. Q2FY19 revenue grew by 13% YoY led by strong execution in railway 254% & solar business 202% while T&D; revenue de-grew by -9%....

Bunching up of orders in T&D; segment in H2FY18 and H1FY19 impacted execution, leading to a 12.4% fall in revenues in H1FY19. Going ahead, orders entering the execution stage will help KEC report high double digit revenue growth in H2FY19 in the T&D; segment. On the positive side, inflows have grown 38% YoY to | 7932 crore. The management is optimistic of 10-15% YoY growth in the same for FY19E. Overall, we expect consolidated revenues to grow at 14.6% CAGR in FY18-20E....

revenue grew 13.1% YoY to INR24.1b in 2QFY19, in line with our estimate of INR23.9b. All business segments, barring T&D; grew strongly. T&D; business (excluding SAE) showed a de-growth of 9% YoY, as execution of projects in hand was delayed as major part of order inflow in the segment fructified in 2HFY18 where execution is yet to pick up meaningfully. Management maintained its revenue growth guidance of 15% for FY19, which should be supported by a pick-up in execution of T&D; orders in hand and strong growth in non-T&D; segments. T&D; revenue stood at 63% of total v/s 80% in 2QFY18, while non- T&D; contributed 37% v/s 20% in 2QFY18. YoY to INR2.5b in 2QFY19, ahead of our estimate of INR2.4b, supported by improving margin profile in the non-T&D; business. For the standalone business, operating profit grew 24% YoY, with margin improving 50bp YoY to 11%. SAE Towers reported weak performance with calculated margin of 4.

KEC International Limited (KEC) is a global infrastructure Engineering Procurement and Construction (EPC) major. It has presence in the verticals of Power T&D;, Cables, Railways and Water & Renewable. Despite delay in T&D; execution, Q1FY19 revenue grew by 11% YoY led by solid pick up in railway, civil & solar businesses. Order book grew by 34% YoY which is 1.8x TTM revenue while railway order book witnessed a robust growth of 250% YoY....

In-line Top-line Performance; EBITDA & PAT Exceed Estimates KEC International (KEC) has delivered a strong performance in 1QFY19 with its revenue growing by 11% YoY to Rs21bn (in-line with our estimate). While its net profit surged by 38% YoY to Rs868mn, EBITDA margin expanded by 100bps to 10.3%. Lower other expenditure as a percentage of sales at 7.5% (vs. 14.1% in 1Q FY18) was partially offset by higher raw material cost. Looking ahead, we expect KEC's earnings to clock 19.4% CAGR through FY18-20E on the back of strong order book, improving margin profile and healthy outlook in T&D; and other emerging segments. Thus, maintaining our positive stance, we reiterate our BUY...

ICICI Securities Ltd | Retail Equity Research The topline increased 13.4% YoY to | 2104.7 crore, close to our estimate of | 2169.7 crore. In Q1FY19, T&D; business revenue fell 14% to | 1277 crore due to bunching up of orders in Q3FY18, Q4FY18 and some execution delays due to elections in some states. The railways business continues to outperform with revenues almost doubling to | 313 crore amid low base. Cable business grew 17.8% to | 259 crore due to higher exports and better sales on HT cables...

FY18 was a strong year despite facing challenges regarding GST implementation in 1HFY18 with revenue at ` 100.9bn grew by 15.3% YoY as EBIDTA grew by 23% to ~ ` 10bn and PAT grew by 1.5x to ` 4.6bn. Overall order book was up 37% given the strong capex environment in power transmission and rail electrification projects. OCF was down 52% YoY as working capital grew ~1%.FCF decreased by 57% YoY with capex for FY18 at ` 1.2bn. It was able to achieve to achieve significant order intake from Brazil (through SAE) and in the SAARC region and see improvement...