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Last Updated : Sep 18, 2018 01:31 PM IST | Source: Moneycontrol.com

Buy KNR Constructions; target of Rs 392: HDFC Securities

HDFC Securities is bullish on KNR Constructions has recommended buy rating on the stock with a target price of Rs 392 in its research report dated August 12, 2018.

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HDFC Securities' research report on KNR Constructions


KNRC continues to outperform its growth guidance and delivered strong 1QFY19 revenue at Rs 5.6bn which was 18.4% above estimates. EBITDA at Rs 1.1bn was 35.7% above our estimates, with EBITDA margins expanding to 19.7% (+215bps YoY, +42bps QoQ). We estimate sustainable margins to be around 16-17% and have revised our estimates to reflect the same. APAT beat stood at 57.5%. Order book is Rs 59.5bn with Rs 2bn addition in Arunachal Pradesh project scope. KNRC is focusing on completing financial closure of its 5 HAM projects (EPC value – Rs 39.8bn) that were won in 4QFY18. KNR has announced FC for 3 and 4th HAM FC is expected in Aug-18. KNR continues to maintain a lean WC capital cycle with NWC days at 30, especially demonstrating strong control on receivables (28days) as compared to 50-75 days for other listed peers.


Outlook


We continue to maintain BUY with and increased SOTP of Rs 392/sh.


For all recommendations report, click here


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First Published on Aug 17, 2018 03:57 pm
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