₹64,500 crore order book: Brokerages stay bullish on this small-cap stock after Q4 results. Time to buy?

Stocks to buy: Kalpataru Projects, a global EPC player with diversified interests in buildings and factories, power transmission and distribution, and roads and bridges, recently released its March quarter results, which came in line with Street estimates. The performance was driven by a strong order book, improved execution, and operational efficiencies.

The company has continued to secure new orders, reporting inflows worth ₹25,475 crore in FY25, taking its total order book to an all-time high of ₹64,495 crore. This is 3.4 times higher than its market capitalization of ₹19,000 crore (as of May 21).

Transmission & Distribution (T&D) orders account for 41% of the order book, followed by Buildings & Factories (22%), Water (15%), Oil & Gas (12%), and Railways (5%).

For FY26, the management has guided for ₹26,000–28,000 crore in order inflows and 20% revenue growth. Analysts believe these targets are achievable, given the healthy order book and a robust tender pipeline.

Brokerages retain optimistic outlook on strong order inflows

Analysts believe these steady order inflows will enhance margins, boost profitability, and reduce debt levels—thereby lowering finance costs and further strengthening the bottom line. 

Axis Securities believes the company is well-positioned for steady revenue growth. It forecasts a robust expansion in EBITDA and PAT, with projected CAGRs of 22% and 41%, respectively, over FY25–FY27. The brokerage expects EBITDA margins in the range of 8.5%–9% in FY26 and FY27.

Consequently, the brokerage has maintained its 'Buy' rating on the stock with a target price of ₹1,350 per share. Emkay Global has also retained its 'Buy' call, setting a target price of ₹1,450 per share as the stock is one of its top picks in the T&D EPC space.

"We remain constructive on the company, given its robust order book, strong revenue visibility, disciplined bidding approach, and focus on efficient working capital management. We introduce FY28 estimates and forecast a FY26–28 earnings CAGR of 26%," said the brokerage.

Additionally, Kotak Institutional Equities has reiterated its 'Buy' rating with a target price of ₹1,220 per share, following the March quarter results.

Kalpataru Projects Q4 results snapshot

The company reported a strong set of numbers for Q4FY25, with revenue at ₹7,067 crore—an 18% year-on-year (YoY) increase—driven by higher sales in the Transmission & Distribution (T&D), Buildings & Factories (B&F), and Oil & Gas segments. 

EBITDA stood at ₹538 crore, up 19% YoY, while profit after tax (PAT) came in at ₹218 crore, reflecting a 29% YoY growth.

The company’s EBITDA margin remained steady at 7.6% in Q4FY25, unchanged from Q4FY24. The T&D and B&F segments were the primary growth drivers, whereas the Railways and Water segments faced execution challenges due to a weak order book, stiff competition, and delayed cash flows.

Despite robust revenue growth, net working capital (NWC) was well managed at 94 days, comfortably within the management’s guidance of under 100 days, which is commendable. The management’s key focus areas include securing large, high-margin orders, enhancing execution, maintaining effective working capital control, and exiting non-core businesses, said Emkay Global.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.