HDFC Securities is bullish on KEC International has recommended buy rating on the stock with a target price of Rs 265 in its research report dated May 31, 2020.
HDFC Securities' research report on KEC International
4QFY20 financial performance was inline with our expectations. COVID-19 impact towards end of Mar-20 resulted in Rs 5-6bn revenue miss. Whilst FY20 was a miss on ordering, KEC has started FY21E on strong note with Rs 40bn of L1 (largely International T&D) and Rs 7.4bn of new wins. Bid pipeline is strong at Rs 450-500bn including Domestic (Rs 350bn)/ International (Rs 150bn). Balance sheet net D/E is stable at 1.1x though COVID disruptions led to collection miss of Rs 3-4bn let to weak OCF. Same have been realized in Apr/May-20.
Outlook
We maintain BUY on KEC International Ltd. (KEC) with a revised TP of Rs 265/sh (vs Rs 253/sh earlier) valuing the stock at 12x FY22EPS.
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