Motilal Oswal's research report on KEI Industries
KEI Industries (KEII) is among the leading players in the Cable and Wire (C&W) industry in India. We believe KEII benefits from multiple growth drivers and business strategies, such as: 1) strong growth potential in the C&W industry over the long term; 2) focus on capacity expansion and gaining market share; 3) growth in the retail business; and 4) higher exports and product innovations. We estimate its revenue/EBITDA/EPS CAGR at ~17%/ 24%/22% over FY25-27. The stock is trading at 49x/40x FY26E/FY27E EPS, which remains attractive. We value KEII at 50x Dec’26E EPS to arrive at our TP of INR5,150, having 19% upside potential. Reiterate BUY. Key risks to our TP are: (a) slowdown in government-led infrastructure projects; (b) higher volatility in raw material prices; (c) global headwinds, which may impact export; and (d) increase in competition due to higher capacity addition in the sector.
Outlook
The stock is trading at 49x/40x FY26E/FY27E EPS, which remains attractive. We value KEII at 50x Dec’26E EPS to arrive at our TP of INR5,150. Reiterate BUY.
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