KEI Industries Q4 Results Review - Robust Outlook Intact; A 20%+ Earnings CAGR To Drive Re-Rating: Systematix

"NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Systematix Research Report.KEI Industries Ltd.’s strong and inline Q4 (volume/revenue/Ebitda/profit after tax up 24%/19%/21% /22% YoY) was led by strong revenue in extra high voltage cables (up 107% YoY at Rs 2.3 billion; FY24: Rs 6.6 billion, up 80% YoY) and house wires (up 31% YoY). Management retained its robust guidance of 15%+/20%+ revenue/PAT compound annual growth rate over five years, driven by India and exports. After surging 51% in FY24, exports is expected to grow 50%+ in FY25. Key drivers are large infra capex world over, buyer’s China+1 strategy and KEI Industries having major certifications in place to sell products in Europe and U.S. markets. Growth in EHV cables revenue (FY24: Rs 6.6 billion) is expected only after new capacity gets operational in FY27. Retail sales is expected to grow at 20%+ CAGR on addition of distributors in new markets and will aid its Ebitda margin (12% by FY27 from ~10.5% currently). Cables is expected to grow faster than wires, per KEI Industries. To support future growth, the company plans to invest ~Rs 20 billion over FY23-26 to build capacities across product lines. Post Q4, we raise FY26E earnings by 4%, expecting better growth and expect 17%/21%/24% CAGR in revenue/Ebitda/PAT over FY2426E (FY19-24: 14%/14%/26%). We remain sanguine about KEI Industries’ promising growth prospects and maintain Hold rating with a higher Rs 4,444 target price (45 times FY26E P/E versus earlier Rs 3,804 at 40 times). A 20%+ earnings CAGR and healthy return on equity (~20%), return on capita employed (~28%) and return on invested capital (~37%) in FY26E should sustain its premium valuation. Strong operating cash flows (~Rs 6 billion annually) will be deployed towards planned capex. .Click on the attachment to read the full report:.Britannia Industries Q4 Results: Profit Dips 3.8%, Revenue Rises Marginally.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner."

KEI Industries Q4 Results Review - Robust Outlook Intact; A 20%+ Earnings CAGR To Drive Re-Rating: Systematix

We remain sanguine about KEI Industries’ promising growth prospects and maintain Hold rating with a higher Rs 4,444 target price

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KEI Industries Q4 Results Review - Robust Outlook Intact; A 20%+ Earnings CAGR To Drive Re-Rating: Systematix

We remain sanguine about KEI Industries’ promising growth prospects and maintain Hold rating with a higher Rs 4,444 target price

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