Kalpataru Projects International Limited — Q4 FY25 earnings call

Call held 19 May 2025

Management summary

KPIL concluded FY25 with record-high revenue and order backlog, driven by strong execution in T&D and B&F segments. The company successfully reduced its debt profile and improved working capital efficiency despite challenges in the Water segment's collection cycle. Management is pivoting towards higher-margin, complex design-build projects and expects 20%+ revenue growth in FY26 with improving consolidated margins.

Highlights

  • Consolidated Revenue crossed ₹22,000 crores mark, growing 14% YoY

  • All-time high Consolidated Order Book of ₹64,495 crores with ₹25,475 crores inflow in FY25

  • Consolidated Net Debt declined by 25% YoY to ₹1,953 crores

  • T&D business turnover crossed ₹10,000 crore mark, recording 28% YoY growth

  • Standalone PBT margin improved 110bps in Q4 FY25 to reach 5.9%

  • Oil and Gas business delivered revenue growth in excess of 100% to ₹1,758 crores

  • Net Working Capital improved to 79 days at consolidated level

  • Management targeting minimum EPS of ₹50 for FY26, up from ~₹40 in FY25

Concerns

  • Labor Availability

Key financials

  1. Consolidated Revenue ₹22,000 Cr +14%YoY
  2. Consolidated EBITDA ₹1,834 Cr +13%YoY
  3. Consolidated PBT ₹823 Cr +17%YoY
  4. Order Book ₹64,495 Cr
  5. Net Debt (Consolidated) ₹1,953 Cr -25%YoY
  6. Working Capital Days (Consol) 79 days

What they filed

Q1 FY27: revenue up 8.8%, net profit up 31.8% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue4,136 4,826 6,204 5,040 5,419 +31%5,788 +20%6,964 +12%5,482 +9%
EBITDA348 402 523 428 447 +28%481 +20%672 +28%488 +14%
Net profit132 157 242 201 200 +52%211 +34%220 −9%265 +32%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • T&D
    ₹10,000 Cr Revenue28% Revenue Growth₹14,461 Cr Order Inflow
  • Buildings & Factories (B&F)
    22% Revenue Growth₹8,225 Cr Order Inflow₹14,000 Cr Order Book
  • Oil and Gas
    ₹1,758 Cr Revenue100% Revenue Growth
  • Water
    ₹9,500 Cr Order Book₹1,500 Cr Receivables (JJM)

Guidance & targets

Revenue

  • Revenue Growth (Standalone & Consol) Revenue · FY26 · High confidence 20% plus
    On back of a strong order book and execution momentum, we will target around 20% plus revenue growth for stand-alone and consol basis.

    — Manish Mohnot, MD & CEO

Margin

  • Standalone PBT Margin Margin · FY26 · High confidence 5.25% to 5.5%

    Previously 4.5% to 5% → 5.25% to 5.5%

    We will focus to improve our margins as we expect stand-alone PBT margin in the range of 5.25% to 5.5%, improvement of 35 basis points to 50 basis points minimum over FY '24.

    — Manish Mohnot, MD & CEO

  • Consolidated PBT Margin Margin · FY26 · Medium confidence 4.5% to 4.75%
    consol PBT margin of 4.5% to 4.75% for full year, which is improvement of closer to 100 basis points as compared to FY '25.

    — Manish Mohnot, MD & CEO

Volume

  • Order Inflow Volume · FY26 · High confidence ₹26,000 to ₹28,000 crores
    we expect order inflows in the range of INR 26,000 crores to INR 28,000 crores for full year '26.

    — Manish Mohnot, MD & CEO

Profitability

  • EPS Profitability · FY26 · High confidence ₹50

    From ₹40 today

    And current year, based on numbers, we should be targeting a minimum of INR 50.

    — Manish Mohnot, MD & CEO

Capex

  • Annual Capex Capex · FY26 · High confidence ₹600-650 crores
    Our guidance for FY '26 is in a similar range of INR 600-650 crores.

    — Manish Mohnot, MD & CEO

Risks & concerns

  • Labor Availability

    high

    Cited as the biggest challenge for the industry and KPIL, particularly for T&D stringing and erection.

    Management acknowledged

  • Water Segment Collection Visibility

    medium

    Uttar Pradesh (UP) and Jharkhand remain 'big question marks' for collection visibility.

    Both acknowledged

  • Geopolitical Global Issues

    medium

    Unpredictability of global events impacting international project timelines.

    Management acknowledged

Areas of evasion (2)

  • Specific names of new geographies being explored
  • Exact quantum of data center project margins beyond 'similar to B&F'

Q&A highlights

3 direct
Water Segment Receivables and JJM Collections Direct
Billed would be around INR 800 plus crores. And there will be unbilled... total billed, unbilled around INR 1,500 crores.

Investors are concerned about the cash-flow impact of the Water segment; management clarified the exact exposure and visibility in states like UP and Jharkhand.

Asked by Mihir Manohar, Carnelian Asset Management

Consolidated Margin Drag and Subsidiary Performance Direct
There are 3 or 4 reasons why margins are down. One... road assets... Second... T&D Saudi projects... Third... losses in Fasttel.

Explains the gap between standalone and consolidated profitability and provides a roadmap for 100bps margin improvement as these legacy issues resolve.

Asked by Gaurav Uttrani, Axis Capital

Tax Rate Increase in FY25 Direct
One, a lot of our international projects have higher tax rate... Second is some projects where we have had losses, we've not necessarily created deferred tax assets.

Clarifies why the tax rate jumped to 31% and sets expectations for a 28%+ tax rate going forward due to international project mix.

Asked by Mehul Mehta, Choice Equity Broking

2 min read 5 chapters

Detailed narrative

T&D and B&F Drive Record Order Backlog

KPIL's flagship T&D and B&F businesses accounted for nearly 90% of order wins in FY25, pushing the consolidated order book to an all-time high of ₹64,495 crores. The T&D segment saw 28% YoY revenue growth, crossing the ₹10,000 crore milestone, while B&F grew 22% with a closing backlog exceeding ₹14,000 crores. Management expects this momentum to continue into FY26 with an order inflow target of ₹26,000-28,000 crores, focusing on complex HVDC and design-build projects.

Strategic De-leveraging and Working Capital Management

The company achieved a significant 25% YoY reduction in consolidated net debt to ₹1,953 crores, aided by a QIP of approximately ₹980 crores and efficient working capital management. Consolidated net working capital days improved to 79 days, well below the management's target of 100 days. This financial strengthening occurred despite an elongated receivable cycle in the Water business, where ₹1,500 crores remains outstanding.

Subsidiary Turnaround and Margin Expansion Roadmap

Management has guided for a 100bps improvement in consolidated PBT margins for FY26 as legacy drags resolve. Losses in Fasttel (Brazil) narrowed to ₹35 crores from ₹70 crores, while the Saudi IBN Omairah projects are nearing completion. Conversely, LMG Sweden reported its best-ever performance with 79% revenue growth and a ₹3,535 crore order book, with the board exploring fundraising options for this subsidiary.

Water Segment: A Cautious Recovery

The Water business was a major drag in FY25 due to delayed collections and deferred fund allocations, resulting in dented revenue growth. However, collections improved in Q4 with ₹570 crores received. While visibility in UP and Jharkhand remains low, management expects 10% growth in FY26 and is being selective in new bidding, focusing on international opportunities to diversify the risk.

Capacity Expansion and New Frontiers

KPIL is expanding its factory production capacity by 50,000 tons per annum to reach a total of 300,000 tons, supporting the robust T&D demand. The company is also making inroads into the data center market, currently working on one project and bidding for 2-3 large projects valued between ₹300-700 crores each. These projects are expected to offer higher ROCE due to lower capex requirements compared to traditional B&F work.

This is an AI-generated summary of a publicly available earnings call transcript.
View original transcript

More Construction earnings calls