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KSH Internationa
Our verdict on KSH Internationa isn’t the consensus take — see where we landed, and the one risk the bull case glosses over.
See the verdict — free →Does management do what it says?
Implement backward integration through in-house upcast copper rod manufacturing.
“Backward Integration (Proposed in-house upcast copper rod manufacturing capabilities)”
The company expects to achieve a total production volume of 28,500 to 29,500 metric tons for the full fiscal year 2026. — target: 28,500 to 29,500 metric tons (+4 more commitments)
“Given our current capacity and a robust demand environment, we have the capability to produce 28,500 to 29,500 metric tons for the full year.”
The company maintains that EBITDA per ton levels of approximately INR 66,000 are sustainable. — target: INR 66,000 per metric ton (+1 more commitment)
“This performance is consistent with our prior commentary that EBITDA per ton at current levels are sustainable.”
The company expects working capital days to trend lower incrementally over the next several quarters. — target: Lower than 75-80 days (+1 more commitment)
“Finally, working capital days remain in the 75-80 day range... though we expect this to start trending lower incrementally over the next several quarters.”
The company expects EV and compressor segments to grow from low single digits to meaningful contributors. — target: Meaningful contribution (+1 more commitment)
“But we expect both the compressors and the EVs to increase from low single digits today to meaningful contributors to the group.”
See the full cited Management analysis of KSH Internationa
How durable is the business?
Export revenue growth accelerated to 37% YoY in Q3 FY26, up from 22% in Q2. Exports now represent 27% of total revenue, driven by expansion across 24 countries. (2 expanding)
“Revenues from exports grew 37% compared to Q3 of FY '25 and represented around 27% of total revenues”
Revenue from specialized winding wires grew 61% YoY in Q3 FY26, maintaining its 75% share of total revenue. This growth is driven by robust demand from T&D (Transmission and Distribution) clients for high-value products like CTC. (3 expanding across 1 engine)
“Specialized winding wires represented approximately 75% of total revenue, excluding other operating revenue in 9 months and Q3 of FY ‘26 and increased 48% and 61% versus a year ago. This was largely driven by ongoing demand from our T&D clients.”
KSH reinforced its technical moat by commencing supplies for 37 HVDC transformer orders. It remains the only Indian company approved for HVDC 400kV transformers, a high-value niche. (2 expanding)
“During the third quarter, we commenced supplying specialized winding wires towards cumulative orders of 37 HVDC transformers received to date.”
Standard wires revenue grew by 55% YoY for the nine-month period, maintaining a stable 25% share of the total revenue mix. (1 expanding across 1 engine)
“Standard winding wires also grew 48% and 55% in 9 months and Q3, respectively.”
The business model successfully protected unit profitability despite a sharp rise in copper prices. EBITDA per ton remained stable at ~INR 66,000, proving the effectiveness of the pass-through mechanism. (2 stable)
“Insulated from commodity prices with a Back-to Back order placement model... Copper Price + value add framework agreement between customer and KSH”
See the full cited Business Model analysis of KSH Internationa
Where does growth come from?
EBITDA per ton has shown a strong upward trajectory over the 9-month period compared to the previous fiscal year, remaining steady at high levels in the most recent quarter. (1 steady, 1 accelerating across 2 signals)
“EBITDA per ton growth was driven by increased sales in higher value-added products, export growth, Utilization, and fixed cost absorption”
Working capital remains steady but management has identified this as a key area for improvement, specifically targeting an increase in payable days to reduce the cash cycle. (1 steady across 1 signal)
“One is our payable days are at low 5 days... we will be consciously purchasing copper on credit from suppliers as against advance payment from the bank... we expect this to start trending lower incrementally over the next several quarters.”
The company successfully maintained its EBITDA per ton despite a sharp increase in copper prices, validating the effectiveness of its pass-through pricing model. (2 steady across 2 signals)
“With changing copper prices EBITDA% might change but EBITDA/ton remain constant with back-to-back order placement model”
The company is pursuing backward integration by manufacturing its own copper rods, which is expected to lower costs and improve profit margins.
“Backward Integration (Proposed in-house upcast copper rod manufacturing capabilities)... to reduce input costs & help the Company’s sustainable efforts”
Rising copper prices act as a constraint on cash flow by increasing the amount of money needed for daily operations, even though the costs are passed to customers.
“copper prices has gone 30% year-on-year... when higher copper prices requires us to have higher working capital and the interest on working capital may be higher.”
See the full cited Future Growth analysis of KSH Internationa
What could break the thesis?
EASING. Q3 PAT was hit by INR 1.6cr one-time labor code costs and INR 2.7cr interest (now repaid). Management expects these costs to be absorbed by growing volumes in Q4. (1 easing)
“EBITDA per ton growth was driven by increased sales in higher value-added products... Specialized and Standard Revenue: 75% Specialized, 25% Standard”
STABLE. Duties are currently in flux, with conflicting information suggesting a range of 18% to 25% (down from 54%). The company remains more competitive than China (at 34%). (1 stable)
“before the duties were on the value addition part was around 54%-odd. And now... we are hearing conflicting information between 18% to 25%.”
STABLE. Working capital days remain high at 75-80 days, with inventory accounting for 40-45 days. Management expects this to trend lower incrementally but not overnight. (1 stable)
“Current net working days on an overall basis is, like you mentioned, around 75 to 80 days on a closing balance basis. Inventory days are a little higher in that 75 days, which occupies almost 40 to 45 days on account of inventory.”
STABLE. While revenue growth was driven by copper prices, the company successfully uses a back-to-back order model to pass these costs to clients, keeping EBITDA/ton stable despite price swings. (1 stable)
“With changing copper prices EBITDA% might change but EBITDA/ton remain constant with back-to-back order placement model”
STABLE. While still high, the company is diversifying into high-growth sectors like Electric Vehicles (EV) and Railways to mitigate this concentration. (1 stable)
“EV adoption rates in India are projected to reach 10-12% by FY26 & 30-35% by FY30”
See the full cited Risk analysis of KSH Internationa
Read the full thesis on KSH Internationa
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