KEC International (KEC) Q1 26/27 earnings summary

Executive summary

• Q1 FY27 delivered consolidated revenues of INR 5,024 crore, nearly flat year-over-year, with resilient performance despite supply chain, geopolitical, and operational challenges.

• Net debt reduced by over INR 150 crore to INR 6,568 crore as of June 2026, with improved working capital days.

• Robust order intake of over INR 6,300 crore YTD and a strong order book plus L1 position exceeding INR 40,000 crore, providing solid revenue visibility.

• Middle East operations, accounting for 25% of the order book, faced delays in order finalization and elevated logistics costs, but execution on the ground remained largely normal.

• Unaudited consolidated and standalone financial results for the quarter ended June 30, 2026, were approved by the Board on August 10, 2026.

Financial highlights

• Q1 consolidated revenue was INR 5,024 crore, nearly flat year-over-year; standalone revenue was INR 3,898 crore.

• Consolidated net profit for Q1 was INR 73 crore, down from INR 124.6 crore in Q1 FY26; PAT margin at 1.4%.

• Consolidated EBITDA margin declined to 5.8% from 7.0% last year; standalone EBITDA margin at ~4%.

• Net debt reduced by over INR 150 crore to INR 6,568 crore as of June 2026.

• Interest cost expected to average 2.3% for the year, with total interest around INR 600 crore.

Outlook and guidance

• Revenue growth guidance for FY27 remains at 12%-15%, with order inflow target of INR 30,000 crore.

• Management expects improved execution and financial performance in coming quarters as supply chains normalize and labor availability improves.

• Margins are expected to gradually improve, but double-digit margins are unlikely in FY27; high single-digit margins targeted for FY28.

• Working capital days targeted at 110 by year-end.

• Management believes an ongoing government investigation will not materially impact operations or financial results.