KNR Constructions good bet: Vinay Khattar

Vinay Khattar - Associate Director & Head of Research at Edelweiss Financial Services told CNBC-TV18, "Construction stocks were in dire straits because the industry itself was in very bad state and they were available at pittance just a while ago. Now the valuation re-rating to certain extent has happened but lot of good that will begin to happen in the industry is yet to flow into the price."

"Government is talking of very aggressive ordering on the road construction site and a big chunk of that order book would happen on the engineering, procurement and construction (EPC) side. KNR Constructions is a very strong EPC player and our sense is that over next two to three years the company could easily grow by 20-25 percent top line. If I were to just take you a bit back in to history during the previous cycle when KNR was relatively smaller and a niche player, the company had shown 70 percent compound annual growth rate (CAGR) in the upcycle over the period of 4-5 years. So just a sheerly in terms of the top line the company is very attractively poised," he said.

"There is a bought value of almost a Rs 50-60 a share which provides us with further comfort. So KNR appears to be a good bet to play the road construction sector with a two to three years view."