Buy Kalpataru Projects International; target of Rs 737: ICICI Securities

ICICI Securities research report on Kalpataru Projects International

Kalpataru Projects International’s (KPIL) Q1FY24 performance was healthy with standalone revenue/EBITDA growth of 15%/17% YoY to INR 16.1bn/ INR 3.1bn, respectively. PAT was lower YoY at INR 1.3bn on account of a decline in other income (last year included dividend from subsidiaries) and increase in depreciation (+41% YoY) on higher capex in FY23. Standalone YTD order intake for KPIL stood at INR 73.8bn, mainly led by T&D and building & factories, taking the overall backlog to an excess of INR 500bn (inc. L1 of INR 40bn). As per the management, promoter pledge is currently at 46.96% and is likely to reduce gradually.

Outlook

We expect domestic and overseas T&D, water, B&F segments to fuel the growth. Maintain BUY with a revised SoTP-based target price of INR 737 (earlier INR 630).