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    Buy KNR Constructions, target price Rs 346: Centrum Broking

    Synopsis

    KNR Constructions Ltd., incorporated in the year 1995, is a Mid Cap company (having a market cap of Rs 7019.62 Crore) operating in Infrastructure sector.

    BuyiStock
    Promoters held 51.48 per cent stake in the company as of 31-Mar-2022, while FIIs owned 5.4 per cent, DIIs 33.48 per cent.
    Centrum Broking has buy call on KNR Constructions with a target price of Rs 346. The current market price of KNR Constructions Ltd. is Rs 248.8. Time period given by analyst is one year when KNR Constructions Ltd. price can reach defined target.

    KNR Constructions Ltd., incorporated in the year 1995, is a Mid Cap company (having a market cap of Rs 7019.62 Crore) operating in Infrastructure sector.

    KNR Constructions Ltd. key Products/Revenue Segments include Income From Contracts and Other Operating Revenue for the year ending 31-Mar-2021.


    Financials
    For the quarter ended 31-03-2022, the company reported a Consolidated Total Income of Rs 1121.91 Crore, up 29.93 % from last quarter Total Income of Rs 863.46 Crore and up 12.14 % from last year same quarter Total Income of Rs 1000.44 Crore. Company reported net profit after tax of Rs 139.71 Crore in latest quarter.

    Investment Rationale
    KNR Constructions’ (KNR) Q4FY22 PAT at Rs1.13bn (up 17% YoY on recurring base) was above estimate of Rs943m led by stronger execution/ margins. Irrigation receivables at Rs6.5bn currently (Rs5.9bn in Feb-22) have remained within this range for several quarters. Also, high margins of ~24% in irrigation build-in the cost of carrying these receivables. Revenue guidance of Rs35bn in FY23E (+7%YoY) is muted despite robust backlog of Rs98bn (3x revenue) due to concerns over availability of funding and hence ability to execute irrigation projects (22% of backlog). The brokerage factor revenue of Rs38.3bn in FY23 on the back of execution visibility of ~Rs35bn from existing highways backlog. EBITDA margins meanwhile are likely to be in 18-18.5% range vis-à-vis 20.7% in FY22 due to lower irrigation revenue and high input costs.

    Promoter/FII Holdings
    Promoters held 51.48 per cent stake in the company as of 31-Mar-2022, while FIIs owned 5.4 per cent, DIIs 33.48 per cent.



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    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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