KEI Industries Ltd. share price target

This quarter saw the company report highest EBITDAM of 10.8% as compared to the last 8 quarters. In spite of drop in gross margins, EBITDAM improved by 130bps YoY and 70bps QoQ due to lower forex loss during the quarter, higher volumes and better product mix. The management is confident of sustaining these margins and hopes to inch closer towards the 11% mark in keeping with...

Established in 1968 in New Delhi, KEI Industries Ltd. (KEI) is engaged in manufacturing and marketing of Extra-High Voltage (EHV), Medium Voltage (MV) and Low Voltage (LV) power cables & House Wire. It has a diversified business model spread across different markets (domestic 87% and exports 13%) and segments (Retail 32% and Institutional 55%).

For 2QFY2019, KEI Industries (KEI) posted good set of results, exceeding our expectations on both, top-line as well as bottom-line fronts. Revenue grew by ~33% yoy (above our estimate), however, the company reported a marginal dip in operating margins. On the bottom-line front, KEI reported growth of ~45% yoy to`41cr on the back of strong..

For 1QFY2019, KEI Industries (KEI) posted mixed set of results. Top-line was lower compared to our estimates, however, the company was able to maintain the bottom-line growth. Revenues grew by ~7% yoy (below our estimate) but company reported improvement on operating margin front. On the bottom-line front, KEI reported growth of ~17% yoy ..

Within wires and cables, low tension (LT) grew at 5% YoY, followed by high tension (HT) at 39%, stainless steel wires (SS) at 17% and house wires (HW) at 71%. Extra High Voltage cables (EHV) declined 34% due to non-clearance of few orders from the customers. However, the same were dispatched in July. With strong execution and health order book of INR4.5bn and L1 in INR0.3bn, we expect EHV revenues to double in FY19. Robust capex to support revenue: The new LT cables plant at Pathredi, Rajasthan got operational by May end. KEI plans to incur additional capex...

For 4QFY2018, KEI Industries (KEI) posted good set of results, exceeding our expectations on both, top-line as well as bottom-line fronts. Revenues grew by ~39% yoy (above our estimate), however, the company reported flat operating margins. On the bottom-line front, KEI reported growth of ~40% yoy to `50cr on the back of strong top-line g..

Robust capex to support revenue: In FY18, KEI incurred a greenfield capex of INR 0.5bn at Pathredi, Rajasthan to add capacity in LT cables, which will be operational by end of May 2018. It plans to incur additional capex of INR0.6bn in FY19 to add new HT cable line other than ongoing capex. The same is likely to be operational by March 2019. LT cables will add INR3bn and HT cable will...

We recently met the management of KEI Industries (KIL) to understand the business model and outlook, going forward. KIL is one of the largest industrial cable manufacturers in India with institutional, dealer and export sales contribution of 55%, 31% and 14%, respectively, in FY17. Being largely in the B2B category, the product profile includes extra high voltage (EHV) cable, high and medium (HV/MV) voltage cables, low tension (LT) cables, speciality cables, winding/flexible and house wires and stainless steel wires, etc. Major clientele includes private & public...

Q3 marks strong revenue and PAT growth driven by increasing contribution from retail segment with high other income and low interest burden Strong revenue growth driven by wires and cables segment: For 3QFY18, KEI's revenue grew 24.1%/18.7% on YoY/QoQ basis to INR 8.9bn, driven by strong 19.8% YoY growth in cables segment. Within wires and cables segment, low tension grew at 23.3% on YoY basis, followed by high tension...

For 3QFY2018, KEI Industries (KEI) posted good set of results, exceeding our expectations on both, top-line as well as bottom-line fronts. Revenues grew by ~24% yoy (above our estimate), however, the company reported lower operating margins. On the bottom-line front, KEI reported growth of ~51% yoy to `39cr on the back of strong top-line ..