The shares of this leading cable manufacturing firm fell by nearly 5.5%, despite the company incorporating a new subsidiary to expand its cable business.
Share price variations:
With a market capitalization of Rs. 27,088.51 crores, KEC International Limited opened the trading session at Rs. 1,022.00, below 2.73% from Tuesday’s close of Rs. 1,050.75. The stock reached an intraday low of Rs. 991.50, reflecting a 5.63% decrease from previous close and ended the session at 1,022.00 a piece.
Reasons for the Fall:
According to the exchange filing, KEC International Limited received the Certificate of Incorporation on October 1, 2024, for its new subsidiary, “KEC Asian Cables Limited.” This subsidiary will focus on manufacturing various types of power cables, solar cables, aluminium conductors, and fibre optic cables and will serve as a vehicle for the proposed subsidiarization of KEC International Limited’s cable business, as approved by the board during its meeting on July 26, 2024.
Recent Orders
In September, the company received an order worth Rs. 1,003 crores for projects related to railways, civil works, and cables, along with an order of Rs 1,423 crores for the design, supply, and installation of 380 kV transmission lines in Saudi Arabia. In August, the company secured an order of Rs 1,079 crores for transmission and distribution (T&D) and cables projects in India, the Middle East, and the Americas. Additionally, in June, it received new orders totaling Rs 1,002 crores for residential projects in India.
Financial Performance:
For Q1FY25 the company reported a net profit increase of 106.8 % to Rs. 87.58 crores compared to net profit of Rs. 42.33 crores in Q1FY24, while revenue from operations also marked an increase by 6.3% to Rs. 4,511.89 crores from Rs. 4,243.59 crores in comparison to the same period.
The company reported a return on equity (ROE) of 8.82% and a return on capital employed (ROCE) of 16% for FY24. As of Q1 FY25, the company has an order book valued at ₹32,715 crores, with 51% of orders coming from transmission and distribution, 31% from civil projects, 10% from railways, and 2% related to cables.
About the company:
Incorporated in 2005, KEC International Limited is the largest Power Transmission Company in the world. The Company is primarily engaged in Engineering, Procurement and Construction business (EPC) relating to infrastructure interalia products, projects and systems for power transmission, distribution, railways and related activities.
Written By Joseph Pv
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