Buy Kalpataru Power Transmissions, target price Rs 555: Emkay Global

Emkay Global has buy call on Kalpataru Power Transmissions with a target price of Rs 555. The current market price of Kalpataru Power Transmissions is Rs 368.95.

Time period given by analyst is one year when Kalpataru Power Transmissions Ltd. price can reach defined target.

Kalpataru Power Transmissions Ltd., incorporated in the year 1981, is a Mid Cap company (having a market cap of Rs 5546.87 Crore) operating in Power sector.


Kalpataru Power Transmissions Ltd. key Products/Revenue Segments include Income from EPC,Contracts,& Others, Transmission Lines, Towers & Structures, Others, Scrap, Export Incentives and Other Operating Revenue for the year ending 31-Mar-2020.


Financials
For the quarter ended 30-09-2021, the company reported a Consolidated Total Income of Rs 3563.00 Crore, up 10.72 % from last quarter Total Income of Rs 3218.00 Crore and up 16.55 % from last year same quarter Total Income of Rs 3057.00 Crore. Company reported net profit after tax of Rs 83.00 Crore in latest quarter.

Investment Rationale
The brokerage expects an improvement in KPP’s order inflows after the removal of restrictions by World Bank and higher railway bids. At the end of H1FY22, inflows stood at ~Rs15bn vs. ~Rs26bn in H1FY21. Lower promoter pledges over time should also augur well for the stock. The stock trades at 10x/8.7x FY23E/FY24E core earnings

Promoter/FII Holdings
Promoters held 54.55 per cent stake in the company as of 30-Sep-2021, while FIIs owned 7.49 per cent, DIIs 28.71 per cent.