In Tuesday’s trading session, shares of one of the leading Transmission & Infra stocks, specialising in the execution of large-scale projects, came in focus after brokerage firm Axis securities initiated a Buy Target on it with a 30 percent Upside Potential.
Price action
With a market capitalization of Rs. 21,859 crores on Tuesday, the shares of Kalpataru Projects Limited were trading at Rs.1241.45 up by 0.25 percent making a high of Rs. 1,259.15 per share compared to its previous closing price of Rs. 1237.75 per share.
What Happened
Kalpataru Projects, specializing in the execution of large-scale projects, and operating across various sectors, saw its shares in demand after Axis Securities initiated a “Buy” target price of Rs. 1,590 with a 30 percent upside potential.
Axis Securities highlighted that KPIL’s strong order book, diversified business portfolio, and divestment of non-core assets are key factors driving its coverage. As an industry leader with a proven track record, the company is well-positioned to leverage its robust order book, efficient execution capabilities, and favorable sector dynamics.
About the company
Kalpataru Projects International Limited (KPIL) is a leading player in the global infrastructure sector, known for its expertise in delivering large, complex, and high-value projects across multiple industries, including power transmission, roads and highways, oil and gas, urban infrastructure, and real estate.
Kalpataru’s impressive portfolio highlights its capability to handle intricate projects, making it a trusted partner for both domestic and international clients. With a wide range of high-profile infrastructure developments, KPIL is driven by innovation and the latest technological advancements, ensuring it meets the challenges of modern infrastructure demands.
Orderbook
The company’s robust order book is expected to drive significant revenue growth. As of September 30, 2024, the order book stands at Rs 60,631 crore, providing revenue visibility for the next 2 to 2.5 years.
The order inflow for the current fiscal year has already reached Rs 17,325 crore, reinforcing confidence in meeting the financial year 2025 order inflow target of Rs 22,000-23,000 crore. With strong growth prospects, the company is projected to achieve a compound annual growth rate (CAGR) of 18 percent in revenue, 20 percent in EBITDA, and 33 percent in PAT over FY24-FY27.
Business orderbook
The company boasts a diversified order book with a broad geographical presence consisting of 37 percent allocated to Power Transmission and Distribution, 22 percent to Buildings and Factories, 17 percent to Water, 14 percent to Oil & Gas, 6 percent to Railways, and 4 percent to Urban Infrastructure.
Financials
The company’s revenue rose by 9.2 percent from Rs 4,530 crore to Rs 4,946.98 crore in Q2FY24-25. Meanwhile, Net profit gained from Rs 89 crores to Rs 125.5 crore during the same period.
Key Financial ratios
Kalpataru Projects International Limited has an Return on Equity (RoE) of 10.1 percent and a Return on Capital Employed (RoCE) of 12.14 percent. Furthermore, the company’s debt-to-equity ratio is 0.94.
Written by Sridhar J
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