KEI Industries Ltd. share price target

KEI Industries (KEI) results were below our estimates, due to sales lost in dealer segment in last 10 days of lockdown. Usually March month is a peak month for sales through dealer/distributor network. Cables division is expected to bounce back in H2FY21 considering the government push for rural electrification and metro transport....

At 10.7x FY22E EPS, although valuations don't appear very cheap, but given that the company has sufficient capacities to generate revenues of Rs 56bn and has a strong execution record, pre qualifications most all leading institutional clients, pan India distribution network, sufficient cash reserves to fund greenfield capex incase demand picks up sooner, stable debt levels at Rs 3bn levels and fairly stable margins(~10%), we feel the company is well poised to capture growth when the...

KEI Industries Institution sales see an uptick, dealer network sales witness a slowdown During the quarter Institutional cable revenues were up ~40.0% YoY to Rs 7.4bn (Domestic Rs 4.7bn, Export Rs 2.7bn). In Q3FY20, Sales through dealer/ distributor network were up 4.5% YoY to Rs 3.7bn and total active dealers were increased from ~1450 in Q2FY20 to ~1600 in Q3FY20. Housing wire division volumes from dealer network were up 30% while cable division volumes grew 10-12%. Exports grew by 82.6% YoY to Rs 2,720m in Q3FY20...

KEI Industries Institution sales see an uptick, dealer network sales witness a slowdown During the quarter Institutional cable revenues were up ~40.0% YoY to Rs 7.4bn (Domestic Rs 4.7bn, Export Rs 2.7bn). In Q3FY20, Sales through dealer/ distributor network were up 4.5% YoY to Rs 3.7bn and total active dealers were increased from ~1450 in Q2FY20 to ~1600 in Q3FY20. Housing wire division volumes from dealer network were up 30% while cable division volumes grew 10-12%. Exports grew by 82.6% YoY to Rs 2,720m in Q3FY20...

During the quarter Institutional cable revenues were up ~33.0% YoY to Rs 6.9bn (Domestic Rs 4.7bn, Export Rs 2.2bn). Sales through dealer/ distributor network were up 4% YoY to Rs 3.6bn and total active working dealers as on 30th September'19 were ~1450. EHV revenues stood at Rs 950m as compared to Rs 70m in Q2FY19 (driven by new capacity additions). EPC Sales (other than cable) grew by 34.9% to Rs 2bn. Order book as on date is ~Rs 43.7bn and the company is L1 in orders worth Rs 1.3bn. Management has guided 18% topline growth in FY20E and EBITDA margins of...

During the quarter Institutional cables sales were up ~21.0% YoY to Rs 5.3bn (Domestic Rs 4.2bn, Export Rs 1.1bn). Sales through dealer/ distributor network were up 23% YoY at Rs 3.7bn and total active working dealers as on 30th June'19 were more than 1500. EHV sales in the quarter were Rs 780m as compared to Rs 390m in 1QFY19. EPC Sales (other than cable) grew by 23.0% to Rs 1.95bn. Order book as on date is ~Rs 44.1bn plus L1 Rs 1.2bn of EHV. Management has guided 18% growth in revenues and EBITDA margins of 10.5-11% in FY20E on back of better product mix (increase in EGV and export...

KEI Industries (KEII) reported robust numbers with revenues growing 22.2% YoY and 15.8% QoQ to Rs 12,588m. EBITDA grew 36.1% YoY and 16.9% QoQ to Rs 1,376m. EBITDA margins sustained at 10.9%, higher by 110bp YoY and 10bps QoQ on back of better fixed costs absorption. PAT grew 20.9% YoY and 23.8% QoQ to Rs 599m. During FY19, revenues/EBITDA/PAT grew by 22.2%/ 30.7%/ 25.8% to Rs 42,270m/ Rs 4,422m/...

Numbers beat estimates, traction continues. Maintain Buy The KEI Industries (KEI) results were more than our estimates, driven by strong sales in the retail segment and growth in EPC and institutional orders. KEI is focusing on expanding its dealer network, as this sales channel offers higher brand stickiness as well as better margins and lower working capital requirement. The institutional sale growth was a positive and management expect this division to grow in double digits. The EHV sales was another growth engine and is expected to rise further,...

KEI Industries (KEII) reported robust numbers with revenues growing 22.2% YoY and 15.8% QoQ to Rs 12,588m. EBITDA grew 36.1% YoY and 16.9% QoQ to Rs 1,376m. EBITDA margins sustained at 10.9%, higher by 110bp YoY and 10bps QoQ on back of better fixed costs absorption. PAT grew 20.9% YoY and 23.8% QoQ to Rs 599m. During FY19, revenues/EBITDA/PAT grew by 22.2%/ 30.7%/ 25.8% to Rs 42,270m/ Rs 4,422m/...

KEI's revenue grew 22% YoY to INR10.9bn driven by strong growth in wires and cables segment. Within that, high tension (HT) cables grew 88% YoY, followed by house wires (HW 48%), extra high voltage cables (EHV 29%), and stainless steel wires (SS 14%). We expect a revenue CAGR of 20% to INR59bn over FY19-21E. This will be majorly driven by strong revenue growth in EHV, HW and HT cables. Going ahead, KEI plans to incur an additional capex of ~INR1bn in FY19 to add HT cable at Pathredi and HW at Silvassa. HT cable and phase 1 of HW is likely to be operational by March 2019, while phase 2 of HW is likely to be operational by end of FY20E (additional capex of INR0.3bn in FY20). Robust revenue growth along with EBITDA margin expansion supported KEIs 3Q PAT growth. Going ahead, we expect KEI to report PAT CAGR of 30% to INR3bn over FY19-21E and EBITDA margins of 10.