Shares of KEC International Ltd fell as much as 7% on Tuesday as brokerage firm Motilal Oswal Securities expects the company's transmission and distribution order flow from domestic operations to be weak.
KEC International shares have declined 7.2% so far today and hit a low of ₹382.30 on BSE. At 11am, the scrip was at ₹385 on BSE, down 6.5% from its previous close.
Domestic T&D is still weak. The management is unsure about orders from state discoms. It expects large overseas T&D orders and sees the segment forming 50% of the order book in FY22, the report said.
The brokerage firm also said that FY21 will be loss making year for its Texas-based SAE Towers business. The business is expected to break even by FY22. KEC has already executed a loss-making order, while another order will be executed by July 2021.
KEC International acquired SAE Towers for $95 million (about ₹440-crore) on a cash-free and debt-free basis in 2010.
KEC International is lowest bidder in ₹6000 crore worth of orders, with 50% being from the railways segment.
Strong focus on the civil business could lead to ₹1000 crore revenue by FY21-end, with the same likely to double in FY22. The railways segment saw order inflows of ₹3500 crore in FY21, which could lead to strong growth in FY22, the report added.
