Buy KNR Construct;target of Rs 720: Emkay

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26 Aug, 2025 12:21

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Emkay's research report on KNR ConstructRevenue came in at Rs2.19 bn +2.3% YoY against our expectation of Rs1.9 bn on stable execution rate, adjusting for the Rs148 mn claim, revenue came at Rs2.04 bn -4.6% YoY still higher than our expectation of Rs1.9 bn. EBITDA came in at Rs466 mn +55.1% YoY against our expectation of Rs267 mn on higher revenue flow and margins, adjusted EBITDA margin came at 15.6% +153 bps YoY against our expectation of 14.1%. The management guides for an EBITDA Margin of 13-14% for FY17E/18E. Strong order book providing long visibility and coupled with proven execution capabilities and healthy operating margins will enable strong earnings growth going ahead. Maintain buy with a target price of Rs720/share, the stock trades at 14x/10x FY17E/18E EPS. EBITDA came in at Rs466 mn +55.1% YoY against our expectation of Rs267 mn on higher revenue flow and margins. EBITDA margin came at 21.3% +725 bps YoY against our expectation of 14.1%. Adjusting for the claim amount EBITDA came at Rs317.6 mn +5.8% YoY higher than our expectation of Rs267 mn on higher revenue flow and margins. Adjusted EBITDA margin came at 15.6% +153 bps YoY against our expectation of 14.1%.The management guides for an EBITDA Margin of 13-14% for FY17E/18E. Net Profit came at Rs328 mn +120.5% YoY higher than our expectation of Rs127 mn. Adjusted net profit came in at Rs180 mn +21% YoY (adjusting for Rs148 mn claim received) on lower than expected capital cost (interest and depreciation ) and tax outgo (effective tax rate of 9.8% on adjusted PBT lower than expectation of 20%) as the company took higher MAT credit entitlement, there was no tax refund in this quarter. For all recommendations, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

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