Kalpataru Projects Q2 FY27 Earnings Call: Guides Rs. 35,000-36,000 Cr Order Inflows, Record Backlog Hits Rs. 71,846 Cr (KPIL)

Kalpataru Projects International Ltd held its Q2 FY27 earnings call on November 05, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Strong H1 Profitability, Ahead of Guidance

• Q2 FY 2026-2027 revenue of Rs.7,004 crore — H1 at Rs.13,412 crore; comparable-basis growth (adjusting for the Brazil base effect and road SPVs) of 13% YoY in Q2 and 11% YoY in H1.
• Q2 PBT up 24% YoY to Rs.398 crore — H1 PBT up 34% YoY to Rs.818 crore; H1 PBT margin expanded 130 bps YoY to 6.1% (from 4.8%), significantly ahead of earlier guidance of 75 bps improvement over FY 2025-2026.
• Q2 PAT up 23% YoY to Rs.292 crore — H1 PAT up 34% YoY to Rs.603 crore; H1 FY 2026-2027 EPS at Rs.35/share.
• Near debt-free balance sheet — consolidated net debt at just Rs.72 crore as of 30 September 2026; credit rating upgraded to AA+ stable by both CRISIL and India Ratings; net working capital days at 81 (standalone) and 68 (consolidated).
• ~Rs.650 crore received from the Linje Muntaj IPO — the IPO gain was recognized in other equity (Kalpataru Sweden retains control), so no one-offs flowed into the Q2 FY 2026-2027 P&L.
• H1 FY 2026-2027 capex of nearly Rs.600 crore — incurred to enhance execution capabilities and build future capacity.
• Q2 EBITDA margin softness was one-off driven — an expense at an international subsidiary related to fund proceeds (subsidiary IPO costs booked directly in P&L); no cognizance was taken of profit on sale of shares.

Record Backlog, Raised Inflow Guidance, Deep Tender Pipeline

• All-time-high backlog of Rs.71,846 crore — YTD FY 2026-2027 order inflows up over 60% YoY to nearly Rs.24,000 crore, plus an L1 position of ~Rs.5,000 crore; Q2 wins spanned power T&D/substations (domestic and international), a major Middle East gas infrastructure project, and large residential and industrial plant orders in India.
• Order inflow guidance raised for FY 2026-2027 — from Rs.30,000 crore to Rs.35,000–36,000 crore.
• Bidding intensity of >Rs.2.5 lakh crore in H1 FY 2026-2027 — at a ~10% win rate; similar bidding levels expected over the next 6-12 months (into FY 2027-2028).
• Aggregate tender pipeline of >Rs.50,000-70,000 crore — across T&D, B&F and oil & gas to be submitted over the next 3-6 months (spanning Q4 FY 2026-2027 to Q1 FY 2027-2028); these tenders are already announced.
• T&D pipeline of >Rs.15,000-20,000 crore — orders/bids to be submitted within the next two months (Q3 FY 2026-2027), with India the biggest traction market; >Rs.10,000-15,000 crore of B&F tenders on large residential projects to be submitted in Q3 FY 2026-2027 itself.
• Order book quality deliberately improved — management stated the ~Rs.70,000+ crore book was consciously built over the last 5-7 years with a higher mix of private sector and international clients, funded projects, large upfront advances and minimal working capital, moving away from the historical government/state-heavy book where receivables would get stuck.
• Selectivity retained — management emphasized prioritizing orders meeting strict profitability, working capital and risk-management targets over sheer growth.

PBT Over EBITDA; Interest Costs Structurally Lower

• Core EBITDA margins at 10-12% and 9.5-11% — across T&D, B&F and oil & gas in Q2 FY 2026-2027; management does not see significant improvement from the current order book but expects high single-digit to low double-digit EBITDA margins to remain sustainable across all three businesses (period unspecified).
• ~50% of the order book is variable priced — clients are reimbursing geopolitical-driven cost inflation (petrol, diesel, freight, aggregates, the South India issue) even on some fixed-price projects; significant margin impact is seen only if inflation rises a further 20-30% from Q2 FY 2026-2027 levels.
• Interest cost down from 2.5% of revenue (5 years ago) to 1-1.25% currently — management believes it could further improve (period unspecified), aiding EBITDA-to-PBT conversion; management focuses on PBT over EBITDA because its leverage philosophy differs from the larger industry.
• LNG-related expense slightly above $2 million (~Rs.20 crore) — hit the P&L in Q2 FY 2026-2027; LNG EBITDA margins at ~8% in FY 2026-2026-2027 excluding the exceptional expense, with no significant improvement expected at least on the current order book.
• Working capital discipline — standalone days at ~80 as of Q2 FY 2026-2027 vs. the ~90-day target set at the start of FY 2026-2027; FY 2026-2027 year-end expected at 80-82 days or slightly lower; at consolidated NWC days of ~65-68, management said the growth plan will not need much capital.
• Debt outlook benign — gross debt not expected to rise significantly; on the ~Rs.2,000 crore+ gap between gross and net debt (as of Q2 FY 2026-2027), management typically utilizes its entire banking limits in the last week and first week of every quarter and will continue to do so.
• FY 2026-2027 guidance not revised — but the MD personally believes PBT will come in "much more than what we have budgeted" for FY 2026-2027; analyst Bharat Sheth's question cited 1.6% of PBT margin improvement already achieved.

T&D, B&F and Oil & Gas Lead; Water in Transition

• T&D (ex-Brazil) H1 revenue up 8% YoY to nearly Rs.6,000 crore — YTD orders of Rs.10,122 crore with ~65% from major domestic clients; favorably placed on ~Rs.5,000 crore of projects; management sees a multi-year transmission investment cycle (renewable integration, grid modernization, HVDC) across India, Africa, Middle East, South America and Europe.
• B&F Q2 revenue growth of 20% (H1: 17% YoY) — 27% of consolidated revenue; YTD FY 2026-2027 orders of ~Rs.8,000 crore (management also cited ~Rs.11,000 crore YTD inflows in the Q&A); order book of Rs.21,659 crore as of 30 September 2026; demand seen across all five verticals including data centers and airports.
• Oil & gas Q2 revenue growth of 58% (H1: 38%) — order book of Rs.8,196 crore as of 30 September 2026; landmark Middle East gas pipeline order secured; Saudi Arabia projects remain operationally stable despite the geopolitical situation.
• Water H1 revenue of Rs.1,124 crore — order book of ~Rs.6,700 crore (as of Q2 FY 2026-2027), of which the JJM portion is ~Rs.4,500 crore; from an EPC perspective ~Rs.3,000 crore remains to be delivered, with the balance being O&M contracts running over ~5-7 years; the JJM portion is expected to be completed over the next ~12 months (into FY 2027-2028).
• Water receivables: ~Rs.1,100 crore collected in Q1-Q2 FY 2026-2027 — ~Rs.1,500 crore outstanding (billed + unbilled), majority JJM-linked; about two-thirds is overdue, but monthly collections are coming from all states and management expects a significant reduction over the next six months (through ~Q1 FY 2027-2028).
• Infrastructure H1 revenue of Rs.929 crore — order book of Rs.5,900 crore as of September 2026; all TBMs fully deployed on metro rail projects; urban infra has current visibility of ~Rs.6,000 crore and is a growth engine from a 3-year perspective (through ~FY 2029-2030).
• Middle East is ~14% of the order book (as of Q2 FY 2026-2027) — a mix of oil & gas (largest), T&D (second) and a small water order; execution faces supply chain issues, increased freight costs — which clients are ready to reimburse — and work-stall delays primarily in Saudi; management characterized these as manageable.

15% FY27 Growth Reiterated; Rs.50,000 Cr Ambition

• 15% revenue growth target reiterated for FY 2026-2027 — with sustainable PBT margin expansion; management reaffirmed this despite Middle East delays.
• Consolidated revenue guided at ~Rs.28,000-30,000 crore for FY 2026-2027 — management stated that targeting revenue of ~Rs.50,000 crores over the next 3-4 years (from the FY 2026-2027 base) "would not be a challenge," given the capabilities and capacity built over recent years.
• FY 2027-2028: minimum of 15% growth with improved margins — management said this "will happen" but did not commit to the ~20% growth asked about; more clarity expected in Q4 FY 2026-2027 once there is visibility on the order book, the Middle East disruption and delivery in Q3-Q4 FY 2026-2027.
• ~2.5 years of revenue visibility as of Q2 FY 2026-2027 — excluding L1 business; MD Manish Mohnot said high double-digit growth "should not be a challenge" over the next 2-3 years (FY 2027-2028 onwards).
• T&D growth of 15-20% minimum over a 3-5 year outlook (through ~FY 2031-2032) — management said this with improved profitability and reduced working capital is "easily doable" across domestic and international T&D; citing government plans, management said growing T&D at high double-digit rates with improved profitability over the next three years (through ~FY 2029-2030) "should not be a challenge."
• LNG recovery deferred — flat growth in FY 2026-2027 was "as planned" per management; order book growth expected to return from FY 2027-2028, with revenue recovery possibly in the later part of FY 2027-2028 or in FY 2028-2029.
• Capex of ~Rs.1,100 crore guided for FY 2026-2027 — ~Rs.500 crore more needed in H2 FY 2026-2027; management expects some reduction in FY 2027-2028, citing the historical philosophy of capex equal to depreciation, though the number may be revisited if international opportunities grow significantly.

International Expansion, Linjemontage Upside, Succession

• Growth anchored to core EPC and the six existing sectors — MD Manish Mohnot reflected that the biggest mistakes over his 20 years at Kalpataru came in the first 5 years from entering segments the company did not understand; identified levers are back-end manufacturing integration, international expansion, design-build EPC capabilities, and larger/complex projects.
• Manufacturing growth is the biggest focus over the next 3 years — free cash flows already internally allocated; a large rolling mill at Raipur was announced in Q1 FY 2026-2027 with capex incurrence already started; >Rs.3,000 crore of capex invested over the last 4 years.
• Linjemontage listed on Nasdaq Stockholm in September 2026 — Kalpataru owns ~65%+ (as of Q2 FY 2026-2027) and believes it will hold the stake for a longer period; H1 FY 2026-2027 revenue of Rs.1,472 crore and order backlog of Rs.4,154 crore; growth has been limited in FY 2026-2027 as the team prioritized strengthening risk management ahead of the IPO; management remains bullish, citing a very good visible opportunity over a 3-5 year perspective (from FY 2026-2027).
• Sri Shubham Logistics external debt now closer to zero (as of Q2 FY 2026-2027) — top line growth has not improved significantly, but margins have improved via operational efficiencies and sale of fixed assets; further deleveraging over the next 6-12 months (into FY 2027-2028), with focus shifting to the hired model rather than owned warehouses.
• International push across verticals — oil & gas international built over the last 3 years, water international traction has started (first Middle East water order; qualified with the majority of large developers across Abu Dhabi, Saudi, Qatar and Kuwait), and similar traction in urban is expected in the next 1 to 3 years; B&F has no immediate plans to go international, with focus on India for the next couple of years.
• Leadership transition — Amit Uplenchwar elevated to Joint MD and CEO, bringing ~25 years of experience across heavy civil, infra, oil & gas and energy, with nearly 6 years at KPIL; the MD will spend maximum time on team cohesion and talent retention, international opportunities, and managing the transition while preserving core values, the risk management framework, and the balance sheet built over the last three decades.