KEI Industries’ monitoring agency report for Q2 2026 highlights a strong financial performance, with revenue increasing by around 20% in FY25 and 25% y-o-y in Q1FY26. However, progress on the Sanand capital expenditure project is delayed due to revisions in project design and payment schedules. The unutilized QIP proceeds are mainly held in fixed deposits and monitoring accounts.
Financial Performance Overview
The monitoring agency report for the quarter ending September 30, 2025, indicates KEI Industries’ continued strong financial performance. Revenue increased by approximately 20% in FY25, driven by robust growth in retail (35%), exports (15%), and institutional (3%) segments, with operating margins steady at 10.03%. In Q1FY26, revenue grew by about 25% year-over-year due to healthy order inflows, and capacity utilization remained high at around 80%.
Sanand Project Update
Expenditures for the Sanand capital expenditure project remain below the initially projected figures specified in the placement document. According to management, the variance is primarily because project cost estimations and the payment schedule were made before QIP Funds were received. Revisions to original designs have extended delivery schedules for plant, machinery, and building construction, shifting certain payments to FY26 and subsequent financial years. Phase 2 of this project is now slated for commencement in Q4FY27.
Deployment of Unutilized QIP Proceeds
As of the end of the quarter, a substantial portion of the QIP proceeds remained unutilized, with a total of ₹730.86 crore outstanding. These funds are largely held in fixed deposits and monitoring accounts to generate interest income while awaiting deployment in planned capital expenditure projects. ₹38.61 crore of interest is included in unutilized proceeds.
Details of Funds in Fixed Deposits
Significant portions of the unutilized funds are invested in fixed deposits with various banks, including Axis Bank, Bank of Baroda, ICICI Bank, YES Bank, and IDBI Bank. Maturity dates for these deposits range from October 2025 to March 2026, with earning rates varying between 4.00% and 7.50%.
Source: BSE
