🟢 At a Glance
A flagship of the RPG Group, KEC International delivers turnkey EPC solutions across power T&D, railways, civil, solar, oil & gas pipelines and cables. With a ₹21,847 Cr topline in FY24 (10% 5-yr CAGR) and ₹571 Cr PAT in FY25, it trades at 42× trailing EPS, banking on a ₹2.7 B order win pipeline—but margin swings and working-cap cycles raise risks.
About the Company
- Incorporated: 1945 (as Kamani Engineering)
- Listed: 1992 (BSE: 532714, NSE: KEC)
- Headquarters: Mumbai
- Business Verticals:
- Power Transmission & Distribution (40% FY25 revenues)
- Railways & Metro Systems (15%)
- Civil & Urban Infrastructure (17%)
- Solar EPC (10%)
- Oil & Gas Pipelines (8%)
- Cables & Conductors (10%)
- Global Footprint: 100+ countries across Asia-Pacific, Africa, Middle East & Americas
- Order Book: ₹22,500 Cr as of Q1 FY26; targeting 1.0× sales cover
Key Managerial Personnel (KMP)
- Mr. Harsh V. Goenka – Chairman
Visionary oversight as head of RPG Group. - Mr. Vimal Kejriwal – Managing Director & CEO
Steers global operations and integration of digital execution tools. - Mr. Rajeev Aggarwal – Chief Financial Officer
Manages debt mix, hedging, and investor relations. - Mr. Milind Apte – Chief Human Resources Officer
Leads talent strategy for 40,000+ workforce. - Mr. Suraj Eksambekar – Company Secretary
Ensures compliance with SEBI/LODR norms.
Key Financials (Consolidated)
| Metric | FY21 | FY22 | FY23 | FY24 | FY25 |
|---|---|---|---|---|---|
| Revenue (₹ Cr) | 13,742 | 17,282 | 19,914 | 21,847 | 22,180 |
| EBITDA (₹ Cr) | 1,001 | 920 | 1,353 | 1,504 | 1,504 |
| EBITDA Margin | 7.3% | 5.3% | 6.8% | 6.9% | 6.8% |
| Net Profit (₹ Cr) | 332 | 176 | 347 | 571 | 571 |
| EPS (₹) | 12.92 | 6.85 | 13.49 | 21.44 | 21.44 |
| ROCE / ROE | 14% / 13% | 12% / 14% | 16% / 15% | 16% / 12% | 16% / 12% |
| Net D/E (x) | 0.86 | 0.91 | 0.99 | 0.75 | 0.75 |
| Working-Cap Days | 101 | 84 | 91 | 98 | 98 |
Strategic Events & Business Triggers
- SAE Towers Acquisition (2010): Cemented leadership in steel lattice towers.
- Cables Merger: Brought downstream integration, capturing cable-margin.
- Digital Rollout: Deployed BIM and ERP across sites, cutting cost overruns by ~5%.
- Order Wins: ₹2,211 Cr fresh EPC orders in June 2025 across T&D, pipelines & cables.
- Renewables Pivot: Solar EPC capacity target 2 GW by FY27; first 500 MW booked.
- Green Finance: ₹500 Cr Green Bonds in 2024 funding clean-energy projects.
⚖️ Fair Value Estimate
- Assume FY26 EPS +10% → ₹23.6
- Target PE: 20–24× (peer average 18–32×)
- → Implied Price: ₹472 – ₹567
- CMP: ₹901 implies lofty 38× FY26 EPS
📌 EduInvesting Take
KEC is a bellwether EPC play with:
- 🌍 Global diversification hedging India cycle
- 🏗️ Multi-vertical strength from T&D to pipelines
- 💹 Healthy order book sustaining 10% sales CAGR
Yet, at 42× trailing EPS:
- 🔴 Profit volatility (FY22 dip vs. FY25 peak)
- 🔴 Working-cap drag (~98 days tying ₹600 Cr)
- 🔴 Execution risk on mega projects
Buy only on dips to ₹800 (35×) or on clear evidence of order-book scaling to ₹30,000 Cr+.
🚩 Risks & Red Flags
- Order-inflow Cyclicality: Volatile award cycles can dent margins
- Input-cost Inflation: Steel/cement volatility hits contracts
- Forex Exposure: INR swings affect 50% export revenues
- Execution Delays: Time/cost overruns could compress 7% EBITDA buffer
- High Valuation: 42× EPS factors in perfect execution
Final Word
KEC International towers over peers in scale and diversification—but the valuation bar is sky-high. A pragmatic entry around ₹800–₹850 or after a demonstrable uptick in order-book momentum is prudent.
✍️ Author: Prashant Marathe
📅 Date: June 17, 2025
Tags: kec international, epc, transmission towers, renewables, rpg group, global infrastructure, order book, valuation, working capital
