New orders will contribute 8-10% to margins: KEC Intl

KEC International has won orders worth Rs 668 crore, which would be 8-10 percent of company‘s margins, says Vimal Kejriwal, MD and CEO, KEC International.The company’s orderbook stands at Rs 10,000 crore, of which orders worth Rs 400 crore are from the transmission and distribution business, he says, adding they will be executed in another 12-15 months. The cable orders are worth Rs 160 crore and solar business worth Rs 111 crore, he tells CNBC-TV18. Below is the transcript of Vimal Kejriwal’s interview with Reema Tendulkar and Mangalam Maloo on CNBC-TV18.Reema: Rs 668 crore is the order wins that you have clocked in. Could you give us some more details what would the order book now stand at, the timeline of execution?A: Our order book today is around Rs 10,000 crore and if you look at the orders, Rs 400 crore are from the transmission and distribution business, so they will take around 12-15 months for execution. And cables is Rs 160 crore which is normally executed within the next three months. And if you look at little bit further down, we have got orders of Rs 111 crore from our solar business which is a new business vertical which is we have just gone into and successfully we have got four to five orders from the Telangana business.Mangalam: Could you give us a sense of the margins on this order win that you have?A: These orders would all be between 8-10 percent margins.Reema: So, that is higher than the margins that you have been clocking in, so can we expect your margins to go up from here?A: The margins what we have been saying as compared to last year six percent which should be doing around 7.5-8 is what we expect.Reema: Since solar is a new segment for you, could you tell us what the expected margins would be on that?A: Solar the margins we are talking about would be in the similar region, but the difference what is there is that in solar you get a project, in three to four months, you complete the project. So, working capital and all that is much better in solar.