In Monday’s trading session, shares of one of the leading Infrastructure companies in India specialised in providing comprehensive solutions across the power, transportation, urban infrastructure sector and more, is in focus after brokerage company Motilal Oswal initiated a Buy Target on it with a 30 percent Upside Potential.
Price action
With a market capitalization of Rs. 20,561 crores on Monday, the shares of Kalpataru Projects International Limited is trading at Rs. 1,168.50 down by 2.8 percent making a low of Rs.1,141.25 per share compared to its previous closing price of Rs. 1,203.65 per share.
What Happened
Kalpataru Projects International Limited specialised in providing comprehensive solutions across the power, transportation, urban infrastructure sector and more is in focus after Motilal Oswal initiated a “Buy” target price of Rs. 1,500 with a 30 percent upside potential.
Investment Rational
Strong Market Position: KPIL is well-positioned in fast-growing sectors such as power Transmission & Distribution (T&D) and Buildings & Factories (B&F). They benefit from a robust order book of Rs. 60,631 crore, providing healthy revenue visibility for 2.5 to 3 years.
Increased Inflows: The company has been experiencing sharp growth in order inflows, particularly in T&D and B&F segments, both domestically and internationally.
Stable Commodity Prices: With the correction in commodity prices, particularly copper and hot-rolled coil (HRC), KPIL stands to benefit, especially with 40-45% of its order book on a fixed-price basis.
Improved Balance Sheet: The company raised INR 10 billion via a Qualified Institutional Placement (QIP), with most of the proceeds earmarked for debt reduction.
Execution Ramp-up: Expected execution improvement outside the water segment, supported by strong order backlog and easing payment issues.
Real Estate Growth: The real estate arm is seeing improved traction, with significant ongoing and upcoming projects, which could provide additional growth opportunities.
About the company
Kalpataru Projects International Limited (KPIL) is a leading global player in the engineering, procurement, and construction (EPC) sector, specializing in a wide range of infrastructure projects. The company focuses on key sectors such as power Transmission & Distribution (T&D), Buildings & Factories (B&F), water, oil & gas, railways, and urban infrastructure. KPIL has a strong track record of executing large-scale, complex projects across domestic and international markets, making it one of the most trusted names in the industry.
Breakdown of KPIL’s Orderbook
As of Q2FY25, Kalpataru Projects International Limited has a diversified order book valued at Rs. 60,631 crore, with Transmission & Distribution (T&D) leading at 37 percent (Rs. 22,269 crore). Buildings & Factories (B&F) contribute 22 percent (Rs. 13,156 crore), Water accounts for 17 percent (Rs. 10,519 crore), Oil & Gas represents 14 percent (Rs. 8,474 crore), Railways makes up 6 percent (Rs. 3,569 crore), and Urban Infrastructure contributes 4 percent (Rs. 2,644 crore).
Financials
The company’s revenue rose by 9.20 percent from Rs 4,530 crore to Rs 4,946.98 crore in Q2FY24-25. Meanwhile, Net profit rose by 41 percent from Rs 89 crores to Rs 125.5 crore during the same period.
Key Financial ratios
Kalpataru Projects International Limited has a Return on Equity (RoE) of 10.1 percent and a Return on Capital Employed (RoCE) of 12.14 per cent. Furthermore, the company’s debt-to-equity ratio is 0.94.
Written by Sridhar J
