Buy Kalpataru Power Transmission; target of Rs 403: HDFC Securities

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26 Aug, 2025 12:21

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HDFC Securities' research report on Kalpataru Power Transmission

Kalpataru Power’s (KPP) 4QFY17 revenue came in below our estimates, with growth at 12.5% YoY. EBITDA margin improved 40bps to 10.8%. Aided by lower interest cost (-20.1% YoY), APAT registered a strong growth of 33.5% YoY to Rs 876mn (in-line with estimates). Order inflows improved substantially to Rs 28.5bn, post a muted 3QFY17.

Outlook

Improved traction in railways (with improving margin profile) is an added advantage. High OCFs (Rs 3.2bn) in the SA entity is adequate to address fund flow needs in the subsidiaries, without stressing the balance sheet. Reiterate BUY with a TP of Rs 403/sh (SA EPC at Rs 330/sh, 15x Mar-19E EPS).

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