Top Conviction Ideas : Buy Kalpataru Projects International Ltd for Target Rs. 1,470 - Axis Securities Ltd
* Robust Order Book to Support Revenue Growth: As of 30th June, 2025, the company's order book stands at Rs 65,475 Cr, with 41% from T&D, 25% from B&F, 14% from Water, 11% from Oil & Gas, 5% from Railways, and 4% from Urban Infra. Backed by a strong execution track record and expanding opportunities across all segments, KPIL is positioned for steady revenue growth, projecting a 19% CAGR from FY25 to FY27E.
* New Order Inflow to Sustain Growth: The YTD order inflow stood at Rs 9,899 Cr. The management expects full-year order inflow in the range of Rs 26,000- 28,000 Cr, with a major focus on the T&D and B&F segments. It anticipates traction in Oil & Gas and the international Water segment, while remaining positive on growth across all businesses except Railways.
* EBITDA Margins & PAT Expected to Expand: Recent order wins are expected to support margin expansion, driving improved profitability. Management anticipates a 100 bps increase in operating margins for FY26. Additionally, reduced debt levels are lowering finance costs, strengthening the bottom line. We project robust growth in EBITDA and PAT, with expected CAGRs of 24% and 47%, respectively, over FY25–FY27E, and forecast EBITDA margins in the range of 8.5%-9% for FY26E/27E.
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