Buy KEC International Shares; Target Price Set at Rs 1,000

Investment firm Sharekhan has issued a recommendation to buy shares of KEC International, setting a target price of Rs 1,000. This comes in light of the company’s solid performance in the first quarter of the fiscal year 2025 (Q1 FY65), where revenues reached Rs 5,073 crore, marking an 11% year-on-year increase.

Financial Performance Highlights

KEC’s growth was largely driven by its Transmission and Distribution (T&D) segment, which saw a remarkable 26% increase compared to the same period last year. The company also reported an improvement in EBITDA margins, which rose approximately 98 basis points to reach 7.0%. Additionally, profit after tax (PAT) surged by 42% year-on-year, totaling Rs 125 crore.

As of the current fiscal year 2026, YTD order inflows stood at Rs 5,517 crore. Despite recent challenges, including a slowdown in tendering activities, management remains optimistic about a pick-up in tendering moving forward.

Order Book and Future Outlook

KEC International currently holds an order book valued at Rs 40,000 crore, which includes Level 1 (L1) bids exceeding Rs 6,000 crore. The management indicated that the non-T&D businesses have faced some difficulties over the past three to four quarters, mainly due to labor shortages and collection issues in the water segment. Nonetheless, they expect improvements in the railway sector as early as next quarter.

Given the improving margin trajectory, strong order pipeline, and robust earnings outlook, Sharekhan has maintained its positive rating on KEC International. Investors are advised to consider this recommendation in light of the company’s recent performance and future prospects.

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