Multiple brokerages have issued mixed recommendations on KNR Constructions with target prices ranging from ₹126 to ₹160 per share. According to reports from Prabhudas Lilladher, the brokerage has issued a hold rating with a target price of ₹126 per share based on sum-of-the-parts (SoTP) valuation methodology. Motilal Oswal has set a target of ₹160 while maintaining a neutral stance, citing the company's strong order book and execution capabilities. As reported by Prabhudas Lilladher, while the stock currently trades below book value, valuations remain demanding at 18x FY28E EPS, which limits near-term upside potential. Motilal Oswal has now recommended a neutral rating with a target price of ₹140 in its latest research report dated August 14, 2026, based on SoTP valuation methodology.
As reported by Motilal Oswal's latest research report, KNR Constructions delivered Q1FY27 revenue of ₹4.3 billion, declining 9% year-on-year, which was 13% below the brokerage's estimate. The company's reported EBITDA margin expanded 210 basis points year-on-year to 15%, with EBITDA rising approximately 6% YoY to ₹655 million, though this exceeded the estimate of ₹503 million. However, Motilal Oswal notes that underlying EBITDA margin stood at just 5.5%, as the reported EBITDA included a one-time income of ₹400 million. Despite the challenging quarter, the company maintained a healthy order book of ₹87 billion representing 4x trailing twelve-month revenue.
According to the report, the Q1FY27 order book comprises ₹87 billion with an additional ₹66 billion of L1 orders. The mining segment accounts for approximately 45% of the total order book, followed by roads at 38%. As reported by Prabhudas Lilladher, mining projects are yet to enter the execution phase, with the Kusmunda MDO expected to commence in September 2026 and Banhardih likely to commence in FY28. Management has reiterated FY27 revenue guidance of ₹22-23 billion and expects 30-35% revenue growth in FY28. Motilal Oswal estimates revenue and EBITDA CAGR of 22% and 48% respectively over FY26-28.
As reported by Prabhudas Lilladher, management indicated that a share buyback is under consideration as part of the company's capital allocation strategy. The company's standalone cash position stood at ₹3.1 billion in Q1FY27, with ₹10 billion awaited from asset sales. The management expects meaningful improvement in execution from Q3FY27 as key projects including Chennai ECR HAM, Telangana HAM and Kusmunda MDO ramp up their operations. Recent market data shows average positive change of 3.74% with maximum positive change of 29.66% recorded in August 2009.
