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KEI Industries hosted a
conference call on Oct 21, 2022. In the
conference call the company was represented by Anil Gupta, CMD and Rajeev Gupta, Executive Director (Finance)
& CFO
Key takeaways of the call
Order Book as end of Oct 19, 2022
end stood at Rs 3016 crore [EHV including EPC component was Rs 611 crore,
Domestic Rs 1617 crore, exports Rs 82 crore]
Domestic Institutional EHV cable
sale stood at Rs 46 crore (down from Rs 154 crore in Q2FY22) impacted adversely
by delay in inspection by utilities and collections and will normalize soon. This business depends on specific orders from
transmission companies/utilities and sometimes
they will delay inspection and dispatch order due to ROW issues for the
concerned projects. Expect Rs
500-600 crore of revenue run rate to come back soon.
Expect CAGR growth of 17-18% in
revenue for next few years. The company will maintain an EBITDA margin of 10.5%
for full year.
B2B business outlook is good with
demand driven by investment on energy
and infra sector. Expect good demand from investment in steel, aluminum and
refinery, metro, roads, airports etc. leading to increased demand for products
of the company. Uptake in realty sector is increasing thus driving demand for
wires and cables. T&d segment new orders released by distribution utilities
for strengthening rural electrification and underground distribution lines etc.
Of the order book – Institution orders
are natural hedge and 10-15% of order book from utilities/government have price
variation clause.
Capacity utilization on overall
basis stood at 75-78% for Q2FY23.
Total Institutional Cable Sale
including export contributed 42.81% in Q-2 FY 23 against 47.88% in Q-2 FY 22
and 45.81% in H1 FY 23 against 48.56% in H1 FY 22
Dealers of the company holds
inventory to the tune of only about 25-30 days.
Volume growth is 25% for H1FY23
especially for metal copper by about 26% and aluminium by 24%. For quarter the volume growth is 26.9% in
Q2FY23.
Overall 22% fall in input prices
for the company.
Price hike was about 10-11% if
price realization due to price hike.
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