Buy KSB Pumps; target of Rs 699: Karvy

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26 Aug, 2025 12:21

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Karvy Stock Broking's report on KSB PumpsWe expect the investment cycle to recover and ordering activity to pickup for KSB as demand from sectors such as power generation, oil & gas, petchem and chemicals could contribute significantly towards order book build-up and revenues are expected to grow at 11% CAGR during FY14-16E. KSB has strong backing from parent KSB AG, which we believe could continue to act as a key differentiator going forward as there are only few players in India capable of manufacturing technologically complex products meeting standards of DNI, ANSI and API. KSB has recently announced manufacturing of boiler feed pumps for super critical thermal power plants with a CapEx of Rs.2,500 mn over 5 years, which only few players in India could compete.Valuation and Outlook"Given the cyclical nature of the business, we expect KSB to trade at higher multiples than the FY04-14 mean multiple of 18x. We initiate a coverage on KSB pumps with a ‘BUY’ rating for a target of Rs 699 representing an upside potential of 16.0% based on FY16E EPS of Rs.26.9 at a 26x P/E (+1SD of mean P/E during FY04-14)", says Karvy Stock Broking research report.For all recommendations, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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