Technology

For 2QFY2020, KEI Industries (KEI) posted good set of results, which are largely inline
with our expectations on both top-line as well as bottom-line fronts. Revenue
grew by ~23% yoy, while the company reported a slight marginal contraction on
operating level. On the bottom-line front, KEI reported growth of ~84% yoy to
`76cr on the back of strong top-line growth and lower taxes.
Outlook and Valuation: We expect KEI to report net revenue CAGR of ~18% to
~`5,872cr over FY2019-21E mainly due to (a) higher order book execution in EPC
segment; (b) growth in EHV business and (d) higher exports. On the bottom-line
front, we expect CAGR of ~29% to`300cr over the same period on the back of
strong volume growth. Thus, we maintain our Hold recommendation on stock.

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