KEC International has announced the availability of the transcript for its earnings conference call regarding the audited financial results for the fourth quarter (Q4 FY26) and full year (FY26) ended March 31, 2026. The conference call was originally held on Monday, May 18, 2026. The transcript is now accessible on the company's official website.

Financial Context

The company had previously reported its financial results for the period. For the full year FY26, KEC International achieved record consolidated revenues of Rs 23,506 crore, marking an 8% growth compared to Rs 21,847 crore in the previous fiscal year. The operating profit after tax (PAT) for the year stood at Rs 650 crore, reflecting an 18% year-on-year increase.

Key Operational Metrics

The Transmission and Distribution (T&D) business segment was a significant performance driver during the fiscal year. Its contribution to the total revenues increased notably, reaching 68% compared to 59% in the prior year. Additionally, the company reported an all-time high consolidated order intake of Rs 25,280 crore in FY26.

Consolidated Financial Highlights

The following table summarizes the key financial metrics for the quarter and full year:

Corporate Actions

The Board of Directors has recommended a dividend of Rs 5.50 per equity share for FY26, which represents 275% of the face value of Rs 2 per share. This dividend is subject to approval by the shareholders at the upcoming Annual General Meeting. The company also noted that its consolidated net worth stood at Rs 5,682.05 crore as of March 31, 2026.

KEC International has been downgraded to a Neutral rating by Nomura, with the brokerage setting a target price of ₹507. The downgrade follows a weak Q4 performance and a broadly lacklustre FY26, with persistent execution and margin headwinds continuing to weigh on the company's near-term earnings outlook.

Downgrade Rationale and Earnings Outlook

Nomura's decision to move KEC International to Neutral reflects growing concerns over the company's ability to sustain consistent execution amid ongoing operational challenges. The brokerage highlighted that margin pressures have remained a recurring theme, contributing to what it described as a weak Q4 and a muted FY26 overall. These factors have prompted Nomura to implement sharp cuts to its earnings per share estimates for FY27 and FY28.

Order Pipeline and Revenue Growth Guidance

Despite the downgrade, Nomura noted several positive aspects of KEC International's business fundamentals. The company maintains a healthy order pipeline valued at ₹1.8 trillion, reflecting continued demand across its operating segments. Additionally, KEC International has provided a revenue growth guidance of 12–15% for FY27, indicating management's confidence in medium-term business momentum.

Valuation Perspective

Nomura acknowledged that KEC International's valuations appear attractive at current levels, even as the brokerage maintains its cautious stance on the stock. The combination of a sizeable order pipeline and a double-digit revenue growth target for FY27 provides some support to the investment case, though execution risks and margin pressures remain the primary overhangs that led to the rating change.

The downgrade underscores the challenges KEC International faces in translating its strong order book into consistent earnings delivery, with Nomura's revised target price of ₹507 reflecting a more measured assessment of the company's near-to-medium-term prospects.