KEC International (KEC) Q1 26/27 earnings summary

Executive summary

• Q1 FY27 consolidated revenue was INR 5,024 crore, nearly flat year-over-year, with resilient performance despite supply chain, geopolitical, and labor challenges.

• Order intake exceeded INR 6,300 crore across T&D, civil, renewables, cables, and transportation, with a robust order book and L1 position exceeding INR 40,000 crore.

• Net debt reduced by over INR 150 crore to INR 6,568 crore as of June 30, 2026, aided by improved collections and working capital management, though delayed Afghanistan collections and higher inventories limited further reduction.

• Execution challenges from logistics, elevated freight costs, and delayed customer payments impacted margins and profitability.

• Financial statements for Q1 FY27 were reviewed by statutory auditors with no material misstatements identified.

Financial highlights

• Q1 PBT was INR 90 crore with a margin of 1.8%; PAT stood at INR 73 crore, down 42% year-over-year; PAT margin at 1.4%.

• T&D business revenue was INR 3,217 crore, up 2% year-over-year; SAE revenue grew 25% to INR 450 crore.

• Civil segment revenue was INR 993 crore, up 6% year-over-year; cables and conductors revenue was INR 601 crore, up 57% year-over-year.

• Interest cost for Q1 was 3.3%, with total interest around INR 600 crore.

• Standalone revenue was INR 3,898 crore, with standalone PAT at INR 1 crore.

Outlook and guidance

• Revenue growth guidance for FY27 maintained at 12%-15%, with order inflow target of INR 30,000 crore; Q3 and Q4 expected to be stronger for execution.

• Margins expected to improve from Q3 onwards, but double-digit margins unlikely in FY27; high single-digit margins targeted for FY28.

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

• Working capital days targeted at 110 by year-end, with debt reduction of INR 1,200 crore expected.

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