FEBRUARY 10, 2021 / 7:48 AM IST
Dolat Capital Market’s research report on KEC International
KEC has reported Q3 revenue, EBIDTA and PAT in line with estimates (Refer Exhibit 1), with supply chain and labor levels back to normal. Order inflow for YTDFY21 was Rs68.3bn, with 52% domestic orders. Order book is at Rs179bn, and Rs240bn if current L1 orders are included. The overall tender pipeline is strong with revised GEC bids in T&D, and railway tendering having restarted, the company has quoted for orders of Rs300bn where bids will be opened in the next 2-3 months. Similarly, there are projects worth another Rs300bn which forms the bid pipeline for the company. While KEC has done a 6% growth in 9M, they expect to end FY21 with a double digit growth, based on a strong Q4.
We incorporate this in our estimates as shown in Exhibit 2. We continue to maintain our Buy rating with a TP of Rs440 valuing it at 13 x Sep 22E.