Moneycontrol PRO

Buy KNR Constructions; target of Rs 337: Dolat Capital

Dolat Capital is bullish on KNR Constructions has recommended buy rating on the stock with a target price of Rs 337 in its research report dated August 19, 2020.

August 21, 2020 / 02:06 PM IST
  • bselive
  • nselive
Todays L/H

Dolat Capital's research report on KNR Constructions

KNR posted revenue in line however, EBITDA margins and PAT above estimates. KNR posted 3.2%/ 4.8%/ (16.6%) YoY growth in revenue/ EBITDA/ Adj. PAT to Rs4.8 bn/ Rs943 mn/ Rs398 mn in Q1FY21. We broadly maintain our revenue estimates however, we increase our EBITDA margin estimates by 48/ 50 bps for FY21E/ FY22E factoring Q1FY21 results. We have sizably lowered our depreciation estimates and increase our tax rate and accordingly increased our PAT estimates by 10.9%/ 10.4% for FY21E/ FY22E. Labour availability currently stands at 60% which is expected to increase to 80-85% in 1-2 months.


We expect a 19.2%/ 15.3% revenue/ APAT CAGR over FY20-22E, with EBITDA margins of 17.5% each for FY21E/ FY22E. Considering pick up in execution from Q3FY21E, healthy return ratios, a well-managed balance sheet, comfortable working capital, low D:E, and quality management, we maintain BUY with a SOTP-based TP to Rs337 (15x FY22E EPS and 1.2x PB for HAM + BOT investment). We have excluded KNR Walayar Tollways valuation from our SOTP as KNR is finalizing a deal with Cube Highways.


For all recommendations report, click here

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on are their own, and not that of the website or its management. advises users to check with certified experts before taking any investment decisions.

Broker Research
first published: Aug 21, 2020 02:06 pm
ISO 27001 - BSI Assurance Mark