KEC International: ₹37,697 cr orders, profit fell 42%

KEC International Limited (NSE: KEC) is the RPG Group's transmission EPC arm. Its stock has more than halved in a year, falling from above ₹880 to ₹372, a 58% fall, even as the order book hits records. What happened Q1 FY27 consolidated revenue was flat at ₹5,024 crore. EBITDA fell 17% to ₹291 crore, with margin down 120 basis points to 5.8%. Net profit fell 42% to ₹73 crore. The order book stands at ₹37,697 crore, with T&D at 62%. T&D revenue was ₹3,217 crore, up 2%. KEC won its first transmission order for data centre power evacuation from a private developer. The T&D tender pipeline is over ₹2 lakh crore. Why it matters The Green Energy Corridor Phase III has a ₹1.86 lakh crore outlay. T&D accounts for ₹1 lakh crore of KEC's tender pipeline. Management expects multi-year growth from renewable integration, grid modernisation and data centres. My view Two drags pulled the stock down. First, governance. In March 2025, a bribery charge surfaced. Power Grid Corporation banned KEC from fresh tenders for nine months, restoring eligibility only on 26 June 2026. Second, cash. Net debt is targeting a cut to ₹5,500 crore. Working capital is 134 days, guided down to 110 by March 2027. P/E has fallen to 16.5 times against a 10-year median of 22.6 times. The order book is at the highest level ever. If execution ramps in Q3 and Q4 and working capital improves, the earnings recovery could be sharp. What I am watching Q2 FY27 results, margin recovering above 7%, debt falling, and new PGCIL orders arriving. On the chart, ₹370 is the key support level. My stance: Accumulate near ₹370. The governance risk is now largely behind it. Execution is the new test. Disclosure: I do not hold a position in KEC International Limited at the time of writing. This is not investment advice.