Govt orders, private capex fuel KEC's order book by Rs 6,000 crore

The company reported Rs 23,716 crore of orderbook in the fiscal year ended March 2022, up by 18% over the previous year and plans to bid for Rs 1.1 trillion of orders, which are in the pipeline

KEC International, an RPG group company, has seen a sharp uptick in the order book for the ongoing financial year at Rs 6,000 crore as the government increases its spend on new projects and capital expenditure by private companies picks up.

The company reported Rs 23,716 crore of orderbook in the fiscal year ended March 2022 — up by 18 per cent over the previous year and plans to bid for Rs 1.1 trillion of orders, which are in the pipeline.

“We are constructing several new cement plants by ACC, Ambuja, Ultratech. Shree Cement across the country. We are also doing the civil construction for Grasim’s new paints plants,” said Vimal Kejriwal, MD & CEO, KEC International. The company is also executing civil work on seven Metro rail projects and two depot projects and data centres.

“Our new order wins, especially from Indian railways, is witnessing a gradual uptick through orders in both conventional and new segments. The business has secured its maiden order in the anti-collision segment under ‘Kavach,’ which aims to enhance safety of Indian Railways with world class technology,” Kejriwal said.

“The orders in transmission and distribution have expanded our order book, especially the third order from PowerGrid in quick succession. These orders, along with orders announced earlier during the year, will significantly contribute towards our growth in the domestic T&D market. The order in the oil and gas pipelines further enhances the business’ order book,” Kejriwal said.

The company is foraying into construction of airports and high courts and plans to expand its footprint in the data centre space. The T&D business of the company is contributing half of its Rs 13,742 crore revenues as compared to 83 per cent in 2016 — showing a sharp rise in railways and civil businesses.

The company acquired a transmission tower manufacturing facility in mainland Dubai in FY20 and ramped up its production capacity from 36,000 MTs to 50,000 MTs this year. The company secured orders of Rs 600 crore in the last 18 months from third party customers, including maiden EPC orders, and has leveraged the Dubai facility to significantly enhance business in the middle-east and North American markets.

The company also acquired KEC Spur Infrastructure, an EPC company for accelerated growth and has an order book of Rs 1,000 crore as it taps the annual domestic market opportunity of Rs 6,000 crore. 
 

Kejriwal said the company was getting several orders from India’s water supply scheme for each household. “The company has orders of over Rs 2,500 crore and is providing water supply to 600,000 households in many villages under the Jal Jeevan Mission,” he said.

Cashing in on capex resurgence
 

• Government’s thrust on Infrastructure, metro, and water supply projects
   
• Return of private capex in cement, paints, data centres
   
• Enhanced capex by Gulf countries backed by high oil prices
   
• Uptick in tendering activities of Domestic T&D and Railways