Company Update : KEC International by Motilal Oswal Financial Services Ltd
In-line revenue and EBITDA; beat on PAT
* KEC International’s revenue and EBITDA were in line with our estimates, but PAT was higher than our expectations.
* Revenue grew 11% YoY to INR50.2b vs. our estimate of INR50.9b. Growth was primarily led by the T&D and Cables divisions, which grew 26% and 6% YoY, respectively.
* EBITDA grew 29% YoY to INR3.5b vs. our estimate of INR3.6b, while its margin stood at 7.0%, up 100bp YoY but down 80bp QoQ.
* PAT surged 42% YoY to INR1.2b, beating our estimate by 6%, mainly due to the lower-than-expected tax rate of 21.4% vs. our estimate of 25.6%.
* Order inflow declined 28% YoY to INR55.2b in 1QFY26, taking the closing order book (OB) to INR344b (+5% YoY). T&D/non-T&D mix stood at 60%/40%. OB + L1 position stood at INR400b.
* During the quarter, the company has 1) initiated capacity expansion at the Butibori tower manufacturing facility post successful expansions in Dubai, Jaipur, and Jabalpur; 2) commissioned the aluminum conductor plant and has initiated the process of doubling the capacity.
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