RKEC Projects (NSEI:RKEC) - Share price, News & Analysis

RKEC fundamental analysis
Snowflake Score
Valuation	2/6
Future Growth	0/6
Past Performance	1/6
Financial Health	2/6
Dividends	4/6

RKEC Stock Overview

RKEC Projects Limited operates as an engineering construction company in India.

Rewards

Price-To-Earnings ratio (12.4x) is below the Indian market (19.8x)

Risk Analysis

Earnings have declined by 6.5% per year over past 5 years

Interest payments are not well covered by earnings

Unstable dividend track record

Profit margins (3.4%) are lower than last year (6.1%)

+ 1 more risk

RKEC Projects Competitors

Price History & Performance

Summary of all time highs, changes and price drops for RKEC Projects
Historical stock prices
Current Share Price	₹36.80
52 Week High	₹117.00
52 Week Low	₹36.00
Beta	0.99
1 Month Change	-18.94%
3 Month Change	-28.47%
1 Year Change	-61.18%
3 Year Change	-33.09%
5 Year Change	n/a
Change since IPO	-56.96%

Recent News & Updates

May 13

RKEC Projects (NSE:RKEC) Has A Somewhat Strained Balance Sheet

Legendary fund manager Li Lu (who Charlie Munger backed) once said, 'The biggest investment risk is not the volatility...

Feb 08

Returns On Capital At RKEC Projects (NSE:RKEC) Paint A Concerning Picture

To find a multi-bagger stock, what are the underlying trends we should look for in a business? Amongst other things...

Dec 31

Here's Why RKEC Projects (NSE:RKEC) Has A Meaningful Debt Burden

David Iben put it well when he said, 'Volatility is not a risk we care about. What we care about is avoiding the...

Shareholder Returns

	RKEC	IN Construction	IN Market
7D	-7.7%	1.2%	2.3%
1Y	-61.2%	-5.5%	-0.9%

Return vs Industry: RKEC underperformed the Indian Construction industry which returned -5.5% over the past year.

Return vs Market: RKEC underperformed the Indian Market which returned -0.9% over the past year.

Price Volatility

Is RKEC's price volatile compared to industry and market?
RKEC volatility
RKEC Average Weekly Movement	7.9%
Construction Industry Average Movement	7.1%
Market Average Movement	6.9%
10% most volatile stocks in IN Market	9.9%
10% least volatile stocks in IN Market	4.5%

Stable Share Price: RKEC is not significantly more volatile than the rest of Indian stocks over the past 3 months, typically moving +/- 8% a week.

Volatility Over Time: RKEC's weekly volatility (8%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
2005	516	Garapati Radhakrishna	https://www.rkecprojects.com

RKEC Projects Limited operates as an engineering construction company in India. The company constructs marine structures, such as wharves, berths, jetties, mooring dolphins, intake structures break waters, and coastal-shore protection works; and roads and bridges, as well as steel girders/PSU girders, and composite girders. It also undertakes building and infrastructure works, including civil works for power and refinery projects port development works, transmission lines, sports complex, buildings works, water intake systems, heavy RCC pre-stressed concrete and steel structures, and framed warehouses/industrial sheds; and rural electrification and LT/HT works.

RKEC Projects Fundamentals Summary

How do RKEC Projects's earnings and revenue compare to its market cap?
RKEC fundamental statistics
Market Cap	₹882.85m
Earnings (TTM)	₹71.19m
Revenue (TTM)	₹2.11b

12.4x

P/E Ratio

0.4x

P/S Ratio

Is RKEC overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
RKEC income statement (TTM)
Revenue	₹2.11b
Cost of Revenue	₹1.57b
Gross Profit	₹538.27m
Other Expenses	₹467.08m
Earnings	₹71.19m

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	2.97
Gross Margin	25.54%
Net Profit Margin	3.38%
Debt/Equity Ratio	103.0%

How did RKEC perform over the long term?

See historical performance and comparison

Dividends

3.3%

Current Dividend Yield

40%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is RKEC undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

2/6

Valuation Score 2/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for RKEC?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for RKEC. This is calculated by dividing RKEC's market cap by their current preferred multiple.
What is RKEC's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	₹882.85m

RKEC key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	0.8x
Enterprise Value/EBITDA	6.9x
PEG Ratio	n/a

Price to Earnings Ratio vs Peers

How does RKEC's PE Ratio compare to its peers?

RKEC PE Ratio vs Peers

The above table shows the PE ratio for RKEC vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	47.1x

Forward PE

Price-To-Earnings vs Peers: RKEC is good value based on its Price-To-Earnings Ratio (12.4x) compared to the peer average (47.1x).

Price to Earnings Ratio vs Industry

How does RKEC's PE Ratio compare vs other companies in the Indian Construction Industry?

Price-To-Earnings vs Industry: RKEC is good value based on its Price-To-Earnings Ratio (12.4x) compared to the Indian Construction industry average (16.3x)

Price to Earnings Ratio vs Fair Ratio

What is RKEC's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

RKEC PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	12.4x
Fair PE Ratio	n/a

Price-To-Earnings vs Fair Ratio: Insufficient data to calculate RKEC's Price-To-Earnings Fair Ratio for valuation analysis.

Share Price vs Fair Value

What is the Fair Price of RKEC when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: RKEC (₹36.8) is trading above our estimate of fair value (₹14.9)

Significantly Below Fair Value: RKEC is trading above our estimate of fair value.

Price to Earnings Growth Ratio

PEG Ratio: Insufficient data to calculate RKEC's PEG Ratio to determine if it is good value.

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Future Growth

How is RKEC Projects forecast to perform in the next 1 to 3 years based on estimates from 0 analysts?

Future Growth Score

0/6

Future Growth Score 0/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

19.4%

Forecasted Capital Goods industry annual growth in earnings

In this section we usually present revenue and earnings growth projections based on the consensus estimates of professional analysts to help investors understand the company’s ability to generate profit. But as RKEC Projects has not provided enough past data and has no analyst forecast, its future earnings cannot be reliably calculated by extrapolating past data or using analyst predictions.

This is quite a rare situation as 97% of companies covered by SimplyWall St do have past financial data.

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RKEC Projects is a dividend payer. Have a look at its current yield, dividend levels over time and whether analysts believe the payout ratio will be sustainable moving forward.
RKEC Projects competitive advantages and company strategy can generally be found in its financial reports archived here.

Past Performance

How has RKEC Projects performed over the past 5 years?

Past Performance Score

1/6

Past Performance Score 1/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

-6.5%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: RKEC has high quality earnings.

Growing Profit Margin: RKEC's current net profit margins (3.4%) are lower than last year (6.1%).

Past Earnings Growth Analysis

Earnings Trend: RKEC's earnings have declined by 6.5% per year over the past 5 years.

Accelerating Growth: RKEC's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: RKEC had negative earnings growth (-44.2%) over the past year, making it difficult to compare to the Construction industry average (33.4%).

Return on Equity

High ROE: RKEC's Return on Equity (5.2%) is considered low.

Discover strong past performing companies

Financial Health

How is RKEC Projects's financial position?

Financial Health Score

2/6

Financial Health Score 2/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: RKEC's short term assets (₹3.1B) exceed its short term liabilities (₹1.8B).

Long Term Liabilities: RKEC's short term assets (₹3.1B) exceed its long term liabilities (₹503.2M).

Debt to Equity History and Analysis

Debt Level: RKEC's net debt to equity ratio (54.8%) is considered high.

Reducing Debt: RKEC's debt to equity ratio has increased from 1.3% to 103% over the past 5 years.

Debt Coverage: RKEC's debt is not well covered by operating cash flow (8.3%).

Interest Coverage: RKEC's interest payments on its debt are not well covered by EBIT (1.6x coverage).

Balance Sheet

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Dividend

What is RKEC Projects's current dividend yield, its reliability and sustainability?

Dividend Score

3/6

Dividend Score 3/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Future Dividend Coverage

3.26%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: RKEC's dividend (3.26%) is higher than the bottom 25% of dividend payers in the Indian market (0.43%).

High Dividend: RKEC's dividend (3.26%) is in the top 25% of dividend payers in the Indian market (1.89%)

Stability and Growth of Payments

Stable Dividend: RKEC has been paying a dividend for less than 10 years and during this time payments have been volatile.

Growing Dividend: RKEC has only been paying a dividend for 4 years, and since then payments have fallen.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (40.4%), RKEC's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its reasonably low cash payout ratio (27.7%), RKEC's dividend payments are well covered by cash flows.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

1.6yrs

Average management tenure

CEO

Garapati Radhakrishna

no data

Tenure

Mr. Garapati Radhakrishna serves as a Managing Director and Chairman at RKEC Projects Limited. Mr. Radhakrishna holds a B.E.

CEO Compensation Analysis

Compensation vs Market: Insufficient data to establish whether Garapati's total compensation is reasonable compared to companies of similar size in the Indian market.

Compensation vs Earnings: Garapati's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: RKEC's management team is not considered experienced ( 1.6 years average tenure), which suggests a new team.

Board Members

Experienced Board: RKEC's board of directors are considered experienced (3.1 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/06/25 00:00
End of Day Share Price	2022/06/24 00:00
Earnings	2022/03/31
Annual Earnings	2022/03/31