Buy KNR Construction: Angel Broking

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Buy KNR Construction: Angel Broking

Angel Broking has given its buy rating on KNR Construction in its August 14, 2008 research report.

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RELATED NEWS KNR Constructions has target of Rs 88: H Agarwal ALSO READ See previous views by Angel Broking See what other Experts & Brokerages are saying about KNR Constructions See messages about KNR Constructions KNR Construct BSE | NSE 30/05/12 Are Mutual Funds betting on KNR Construct?

Angel Broking has given its buy rating on KNR Construction in its August 14, 2008 research report. "KNR Construction (KNRC) is one of the smaller players in the Construction space having a robust Rs1,534 crore order book position at 2.8x FY2008 sales. It has healthy margins owing to its backward integration. Its ability to forge joint ventures to foray into large projects provides earnings visibility over the medium term. Overall, investment in Road Construction is estimated at Rs 2,446 billion going ahead. Hence, there exists tremendous growth opportunity for players like KNRC who have a proven track record. Further, KNRC's strategy of forging joint ventures to foray into larger projects is key positive that provides earnings visibility over the medium term. On a comparative basis too, KNRC is trading at a substantial discount to its peers. It is available at 0.6x FY2010E BV. We have valued the company based on the P/E parameter. Even on P/BV basis, the company is inexpensive trading below its Book Value. At Rs 64, the stock is trading at 4.7x FY2009E and 3.6x FY2010E Earnings. We Initiate Coverage on the stock with a Buy recommendation and 12-month target price of Rs 88, implying an upside of 38% from current levels."

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