KEC International: Well positioned to capitalize on India’s infrastructural push

KECI’s revenue/EBITDA/APAT (miss)/beat stood at -0.1/+0.1/+7.6% vs our estimates. The EBITDA margin moderated on a QoQ basis to 7%. KECI continues to maintain revenue growth guidance of 15% and EBITDA margin in the range of 8-8.5% for FY26 (FY27: ~9.3%), supported by revival in tendering and higher contribution from double-digit margins in the T&D segment and bottoming out of non T&D segment.

The order inflows (OI) came in at INR 55.2bn, led by T&D segment, while the order book (OB) as of Jun’25 stood at INR 400bn (~1.8x FY25 revenue), including L1. Tailwinds benefitting KECI include robust execution in T&D, expected upside in demand from renewable energy segment, focus on grid modernisation & HVDC, growth in real estate projects, increased focus on BESS, and significant OI upside from international markets, which form two-thirds of T&D bid pipeline.

However, it has been affected by headwinds such as labor shortages, subdued execution in transportation segment, and uncertainty on global tariffs. KECI is well-positioned to capitalize on India’s infrastructure push, with T&D and renewables leading growth, increased execution in real estate, while disciplined execution and margin focus shall enhance profitability. Given limited upside on our TP of INR 959/sh, we maintain ADD rating on KECI.

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Source : HDFC Securities Institutional Equities

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