KPI Green Energy: 44% revenue growth & 57% PAT growth in H1-24 for a PE of less than 25
KPIGREEN is in the middle of a growth trajectory and the there is still a lot of headroom to grow quickly given the 541 MW of orders in hand
1. Renewable power generating company in Gujarat
Generates and supply power as an IPP and CPP
kpigreenenergy.com | NSE: KPIGREEN
2. FY17-23: Revenue CAGR of 71% & PAT CAGR of 65%
FY20-23: 10.9X Revenue & 17X PAT
3. Strong Q1-24: PAT up 50% & Revenue up 55% YoY
4. Strong Q2-24: PAT up 64% & Revenue up 35% YoY
5. Overall H1-24 looking strong: PAT up 57% & Revenue up 44%
In comparison the H1 of FY22-23
the consolidated CPP Sales of H1 of FY23-24, grew 35% from INR 245.54 Crs to INR 330.87 Crs (H1 FY23-24)
while that under the Independent Power Producer (IPP) grew by 99% from INR 36.47 Crs to INR 72.38 Crs.
6. FY24 return ratios expected to be better than FY23
7. Outlook: Strong order visibility
i. Orders in had: 541 MW as of Q2-24 vs 144 MW as of Q1-24 end
8. 44% revenue growth & 57% PAT growth in H1-24 for a PE of less than 25
9. So Wait and Watch
If I hold the stock then one may continue holding on to KPIGREEN given the momentum from FY23 has continued on into H1-24 end. Additionally, the momentum is expected to continue into H2-24
The execution is in place given the 44% growth in top-line and 57% growth in PAT for H1-24.
44% growth in top-line and 57% growth is in-line with the 50-60% volume growth in MW talked about in Q1-24 earnings call (Read more)
There is a roadmap for growth given that the orders in hand have ballooned to 500+ MW as of Q2-24 end against the 100+ MW orders in hand as of end of Q1-24 and FY23 end.
10. Or, join the ride
If I am looking to enter the stock then
KPIGREEN has delivered 44% growth in top-line and 57% growth in PAT for H1-24 at a PE of less than 25 which makes the valuations quite attractive.
Outlook for H2-24 is expected to be as good as the performance in H1-24 given the 500+ MW of orders in hand.
Previous coverage of KPIGREEN
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Disclaimer
It is an analysis of the company data and not a stock recommendation
My analysis can be completely wrong and can change the next minute based on changes in my understanding of the company
I look to own good companies at prices where there is a path to market beating returns over decades