CRISIL reduces KNR Constructions fair value to Rs 550

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26 Aug, 2025 12:21

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CRISIL's research report on KNR ConstructionsThe Central government’s thrust on infrastructure has given road projects a shot in the arm. Consequently, KNR Constructions Ltd. (KNR) has seen its order inflow improve significantly. Its current order book of Rs 37 billion offers revenue visibility for more than three years. Although execution of current orders is a monitorable, execution risk is low, as majority of new projects are funded by National Highway Authority of India (NHAI bids out projects only after 80% land is acquired) and KNR has a strong track record of timely completion of projects. KNR’s working capital remains low and well managed with standalone gearing of 0.2x in FY15, owing to a measured approach to bidding for new projects and proven execution capabilities. We retain our fundamental grade of 3/5, indicating good fundamentals relative to other listed securities in India.Further to a downward revision in estimates, we have reduced our fair value of KNR, based on the sum-of-the-parts (SoTP) method-to Rs 550 per share. The contracting business has been valued by the P/E multiple method, BOT(annuity) projects by the DCF method and the Kerala BOT(toll) project by P/B multiple method. At the current market price, the valuation grade is 3/5.Disclaimer: This report (Report) has been commissioned by the Company/Investor/Exchange and prepared by CRISIL. The report is based on data publicly available or from sources considered reliable by CRISIL (Data). However, CRISIL does not guarantee the accuracy, adequacy or completeness of the Data / Report and is not responsible for any errors or omissions or for the results obtained from the use of Data / Report. Opinions expressed herein are CRISIL's opinions as on the date of this Report.  The Data / Report are subject to change without any prior notice. Nothing in this Report constitutes investment, legal, accounting or tax advice or any solicitation, whatsoever. The Report is not a recommendation to buy / sell or hold any securities of the Company. CRISIL especially states that it has no financial liability, whatsoever, to the subscribers / users of this Report. This Report is for the personal information of the authorized recipient only. This Report should not be reproduced or redistributed or communicated directly or indirectly in any form to any other person or published or copied in whole or in part especially outside India, for any purpose.

CRISIL Limited. All Rights Reserved. Published under permission from CRISIL"Source:

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