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Knowledge Marine & Engineering Works Ltd
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NSE: KMEW BSE: 543273 INE0CJD01029 Services Engineering Services 🔎 Screen
₹6,221 Cr
Market Cap
73.2
P/E
4.05
PEG
16.3%
ROCE
20.0%
ROE
0.39
D/E
37.8%
OPM
+32.7%
% from 52W High
96
α RS
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📈 Price History
Ratio Health
— Excellent
— Good
— Average
— Poor
By Category
Shareholding
About

Incorporated in 2015, Knowledge Marine & Engineering Works Ltd provides dredging services, owning and operating marine craft, and repairing, maintaining and refitting marine crafts and marine infrastructure

✓ Strengths 3
  • Company is expected to give good quarter
  • Company has delivered good profit growth of 64.5% CAGR over last 5 years
  • Company has a good return on equity (ROE) track record: 3 Years ROE 21.6%
! Concerns 4
  • Stock is trading at 11.5 times its book value
  • Though the company is reporting repeated profits, it is not paying out dividend
  • Promoter holding has decreased over last quarter: -2.07%
  • Tax rate seems low
Key Ratios Snapshot
📊 Sector Averages
📈 Growth Pattern
📊 Quick Scorecard
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3-Statement Financial Model
Bear / Base / Bull projections · DCF fair value · Reverse-DCF
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Strong beat — FY26 revenue jumped 28% YoY and PAT surged 59% on tonnage tax benefit, but Q4 EBITDA margin compressed sharply to 27.5% from 35.1%. quarter Investor Presentation One-Pager? Jun 2026
Revenue
₹256.28 Cr
+28% YoY (FY26); Q4 at ₹67.62 Cr, +42% YoY
EBITDA Margin
38%
-1pp YoY (FY25: 39%); Q4 margin fell to 27.5% from 35.1%
PAT
₹79.11 Cr
+59% YoY (FY25: ₹49.60 Cr); margin expanded to 31% from 25%, aided by negative tax of ₹0.35 Cr
Order Book
₹1,644.89 Cr
unexecuted ₹1,395 Cr; includes two 15-year green tug contracts worth ₹693 Cr
What Went Right
  • Revenue grew 28% to ₹256 Cr; Q4 revenue up 42% YoY to ₹68 Cr.
  • PAT rose 59% to ₹79 Cr, with PAT margin improving to 31% from 25% thanks to early adoption of tonnage tax (negative tax expense of ₹0.35 Cr).
  • Secured ₹1,075 Cr in new orders during the year, including two GTTP green tug contracts (15-year charters worth ₹367 Cr and ₹326 Cr).
  • Successfully executed complex rock dredging at JNPA (ultra-hard rock >170 MPa), strengthening KMEW’s technical credentials.
  • Debt/equity improved to 0.39x (from 0.61x) after ₹285 Cr preferential equity issue; total equity rose to ₹573 Cr.
What to Watch
  • Q4 EBITDA margin compressed to 27.5% from 35.1% last year, despite strong revenue growth — driven by higher material costs (3,592 vs 1,859 in Q4) and depreciation doubling to ₹7.69 Cr.
  • Operating cash flow of ₹74 Cr in FY26 trailed reported PAT of ₹79 Cr, indicating working capital absorption (inventories +₹3.4 Cr, trade receivables +₹4.8 Cr).
  • Negative tax of ₹0.35 Cr in FY26 (vs ₹12.60 Cr tax expense last year) is largely a one-time benefit from tonnage tax transition; recurring tax could normalize, pressuring PAT.
  • Shipbuilding segment (₹183 Cr in order book) is still early-stage; the new Saphale shipyard (15 acres) has not yet demonstrated scale or profitability.
  • Capex of ₹379 Cr far exceeded operating cash flows, funded via debt (borrowings increased from ₹133.5 Cr to ₹222 Cr) and equity; elevated asset intensity creates depreciation drag.
Investor Lens
Thesis stays intact given multi-decade policy tailwinds (Sagarmala, Amrit Kaal, GTTP) and KMEW’s multi-year order visibility. However, Q4 margin decline and reliance on tonnage tax for PAT growth are near-term concerns. Key to watch: (1) execution ramp-up at Saphale shipyard and shipbuilding margins; (2) whether charter hire margins can stabilize amid rising vessel operating costs; (3) further green tug contract wins (Phase I of GTTP only four ports); (4) working capital management as the order book converts to receivables. Next quarter’s margin trajectory will be critical for sustained re-rating.
From investor presentation · AI-generated analysis · Not investment advice
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📊 MIXED Revenue up 45% YoY but margins compressed; PAT boosted by other income & negative tax.
Revenue
Revenue grew 44.7% YoY to ₹68.0 Cr in Mar 2026 quarter, but fell 24.4% sequentially from Dec 2025, indicating a slowdown in business activity.
Profitability
Net profit jumped 118.2% YoY to ₹24.0 Cr, aided by ₹11.0 Cr other income and a negative tax expense of -36%. EPS rose to ₹10.72 from ₹5.04 last year, though PAT declined 27.3% QoQ.
Margins
Operating profit margin dropped sharply to 27% from 35% YoY and 43% QoQ, despite operating profit rising 11.8% YoY to ₹19.0 Cr. Cost pressures or revenue mix changes likely impacted margins.
Cash Flow
Cash flow data not provided in the quarterly summary; no comment available on cash generation quality relative to reported profit.
Balance Sheet
Total borrowings stood at ₹222.0 Cr with reserves of ₹558.0 Cr, giving a debt/equity ratio of 0.61. ROCE and ROE are healthy at 24.7% and 25.8% respectively.
Key Risks
Revenue declined sharply QoQ despite strong YoY growth, signaling potential demand lumpiness. Margin compression from 43% to 27% (QoQ) indicates cost or pricing headwinds. High PE of 82 leaves limited room for error.
Outlook
The sequential revenue and PAT decline warrants close monitoring of order execution and cost control. Sustained margin improvement and cash flow generation will be critical for maintaining investor confidence.
Generated by AI · Mar 2026 results · Not investment advice
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Revenue by Segment

Segment Q2FY26 Q3FY26 Trend
Bahrain (Geographical)
—
0
EBIT -2
 —
Dredging and Ancillary Services
35
EBIT 12
63
EBIT 33
Myanmmar (Geographical)
—
0
EBIT 0
 —
Ship Building and Repairing
15
EBIT 4
27
EBIT 4
Bahrain
0
EBIT 0
— 		—
Geographical Dredging Services (Myanmar)
0
EBIT 0
— 		—
Total 50 90

Source: NSE Integrated Filing XBRL (Reg. 33 Ind AS). Values in ₹ Crore.

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📊 Analysis Methodology

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