ICICI Direct has given Buy recommendation for Kalpataru Power with a target price of Rs. 490 in its research report issued on Feb 16, 2021
ICICI Direct’s research report on Kalpataru Power
For Q3FY21, KPTL’s standalone revenue was at Rs 1993 crore (our estimate of Rs 2183 crore) merely growing 0.7% YoY on the back of steady execution across all businesses amid challenging economic conditions and labour availability constraints. EBITDA came in at Rs 207 crore (our estimate of Rs 231.4 crore), down marginally by 0.5% while EBITDA margins sustained at 10.4% with marginal decline of 10 bps YoY. Adjusted PAT (net of exceptional items) came in at Rs 147.9 crore, up 16.5% YoY partly aided by reduction in interest expense, which declined 45% to Rs 23 crore YoY. KPTL reported exceptional item worth Rs 154 crore towards gain on sale of Alipurduar Transmission (ATL) and Jhajjar KT.
We value KPTL on an SoTP basis and revise our rating from HOLD to BUY with a target price of Rs 490 (earlier: Rs 200) with base business at 10x FY23E.