KEC International Ltd
(BOM:532714)
â‚ą
428.55
-7.85 (-1.8%)
Market Cap: 114.08 Bil
Enterprise Value: 163.18 Bil
PE Ratio: 20.60
PB Ratio: 1.85
GF Score: 77/100 
Q1 2027 KEC International Ltd Earnings Call Transcript
Aug 11, 2026 / 04:30AM GMT
Release Date Price:
â‚ą450.7
(-5.22%)
Key Points
Positve
- KEC International Ltd (BOM:532714) delivered resilient Q1 FY27 performance with revenues of INR5,024 crores, marginally higher year-on-year, despite geopolitical disruptions and supply chain challenges.
- The company secured new orders of over INR6,300 crores, strengthening its order book to INR37,697 crores, with an additional L1 position of INR3,000 crores, bringing total order book and L1 to over INR40,000 crores.
- Net debt was reduced by over INR150 crores to INR6,568 crores in June 2026 from March 2026, supported by free cash flow generation, and interest costs are expected to decline further.
- The SAE Towers business achieved strong growth with new orders of over INR1,650 crores, including the largest-ever tower supply order from the US, and the order book and L1 position reached a record level of over INR3,800 crores.
- The cables and conductors business delivered stellar revenue growth of 57% year-on-year, driven by robust demand, and new specialty products (elastomeric cables and EBM plant) are slated to commence production, supporting long-term margin expansion.
- The company completed capacity expansion at its Butibori facility, increasing global manufacturing capacity to 483,800 metric tons, positioning it well to cater to growing demand in domestic and international markets.
- The renewables business secured new orders of INR800 crore, and the company is now executing solar and wind projects with cumulative capacity exceeding 600 MW, with a positive long-term outlook.
- The Civil business commissioned the Bedain Water Supply Project in Odisha, a landmark project providing safe drinking water to 166 villages, and secured multiple orders/L1s of over INR1,400 crores in the buildings and factories vertical.
- The company is witnessing a gradual revival in the African market, with a significant transmission line order win, and has expanded its tower supply business into the Middle East, opening up a sizable new market.
- Management remains confident of delivering 12-15% revenue growth for FY27, supported by a robust tender pipeline exceeding INR2 lakh crore and a strong order book.
Negative
- KEC International Ltd (BOM:532714) faced significant challenges in Q1 FY27 due to geopolitical disruptions in the Middle East, leading to supply chain and logistics issues, elevated freight costs, and slower execution on certain projects.
- The company experienced delays in the finalization and award of new orders in the Middle East, impacting order intake conversion, despite strong tendering activity.
- Profitability was impacted by delays in legal closure of disputes and settlement of claims in transportation and metro projects, with the Civil and Transportation segments reporting negative margins.
- The company faced labor shortages during the quarter, particularly in the Civil segment, due to the election period, which slowed execution and impacted revenue growth.
- Calibrated execution of water projects due to delays in payments from customers (Jal Jeevan Mission) affected performance, with significant receivables of INR800-900 crores, of which INR400-500 crores are overdue.
- The company has significant stuck receivables from Afghanistan (approximately INR300 crores), which were expected in Q1 but have been delayed to Q2 or Q3, impacting cash flows and debt reduction.
- Higher inventory levels due to delayed dispatches from the Dubai factory and raw material storage amidst Middle East disruptions increased working capital requirements.
- The standalone performance was weak, with EBITDA margin declining to around 4% and PAT negligible, primarily due to negative margins in railways and civil segments.
- The company expects Q2 FY27 to remain challenging, with margins not expected to improve significantly until Q3, and management has not provided specific margin guidance for the year.
- The company faces ongoing headwinds in India T&D due to right-of-way issues in states like Rajasthan and Gujarat, which are impacting execution and revenue growth.
Operator
Ladies and gentlemen, good day and welcome to the KEC International Limited Q1 FY27 earnings conference call. (Operator Instructions) Please note that this conference is being recorded.
From the management today, we have Mr. Vimal Kejriwal, MD and CEO; and Mr. Rajeev Aggarwal, CFO. I now hand the conference over to Mr. Vimal Kejriwal. Thank you, and over to you, sir.
Vimal Kejriwal
KEC International Ltd - Chief Executive Officer, Managing Director, Executive Director
Thank you, Alaric. Good morning, everyone, and welcome to the KEC Internationalâs Q1 earnings conference call.
Let me begin by sharing an overview of the operating environment, followed by our performance during the quarter and business-wise updates. In the Middle East, our Dubai manufacturing facility and the execution of all ongoing projects continue to operate near normal on the ground. The region accounts for approximately 25% of our overall order book and L1 position. While tendering activity remains strong across the region, we are witnessing some delays in the
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