KNR Constructions Ltd: A Hidden Gem in the Indian Infrastructure Industry

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KNR Constructions Ltd: A Leading Infrastructure Development Company in India


KNR Constructions Ltd (KNRCL) is a listed public company that was incorporated in 1995 and is headquartered in Hyderabad, Telangana. The company is engaged primarily in the construction of roads, bridges, flyovers and irrigation projects across India. KNRCL is a multi-domain infrastructure development organization with more than 2 decades of experience and executes the construction of technically complex and high value projects across segments such as:
  • Express ways
  • National Highways
  • Flyovers
  • Bridges and Viaducts
  • Irrigation Projects
  • Urban Development - Civic amenities
  • Commercial and Residential Projects

Why Invest in KNR Constructions Ltd?

KNR Constructions Ltd has a strong track record of delivering quality projects on time and within budget. The company has a diversified portfolio of projects in various sectors and regions, which reduces the risk of dependency on any single segment or market. The company has also reduced its debt significantly over the years, which improves its financial stability and profitability.

Some of the key financial highlights of KNR Constructions Ltd are:


  • The company’s median sales growth is 17.0% of last 10 years, which indicates a consistent and robust revenue generation capability.
  • The company’s return on capital employed (ROCE) is 21.4%, which means that the company is efficiently using its capital to generate profits.
  • The company’s return on equity (ROE) is 15.7%, which shows that the company is creating value for its shareholders.
  • The company’s earnings per share (EPS) for the trailing twelve months (TTM) is Rs. 17.97, which represents a 40.76% year-on-year growth.
  • The company’s price to earnings (PE) ratio for the TTM is 13.55, which is lower than the industry average of 30.43, indicating that the company is undervalued compared to its peers.
  • The company’s price to book (P/B) ratio for the TTM is 2.47, which is also lower than the industry average of 3.32, suggesting that the company’s assets are worth more than its market price.
  • The company’s dividend yield for the TTM is 0.10%, which means that the company pays a small but regular dividend to its shareholders.

Technical Analysis of KNR Constructions Ltd Stock

  • The stock price of KNR Constructions Ltd has been trading in a range of Rs. 202.70 to Rs. 280.80 in the last 52 weeks. The current share price of Rs. 245 is 13.27% away from the 52 week high and 20.87% above the 52 week low.
  • The stock has been showing an uptrend since March 2023, when it bounced back from the support level of Rs. 202.70. The stock has been forming higher highs and higher lows, indicating a bullish momentum.
  • The stock has also broken above the resistance level of Rs. 248.40 on August 18, 2023, with a high volume of 352,816 shares traded on that day. This signals a strong buying interest and a potential breakout.
  • The stock may face some resistance at Rs. 280.80, which is the previous 52 week high and a psychological level. However, if the stock sustains above this level, it may enter a new bullish phase and reach higher targets.

Investors can accumulate the stock in the range of Rs. 245 to Rs. 230 for a target of Rs. 290 in short term, Rs. 335 in medium term and Rs. 380 and more in long term.

Conclusion

KNR Constructions Ltd is a leading infrastructure development company in India that has a proven track record of delivering quality projects across various segments and regions. The company has a strong financial performance and attractive valuation metrics that make it an ideal investment opportunity for long term investors.

The stock price of KNR Constructions Ltd has been showing an uptrend and has recently broken above a key resistance level with high volume, indicating a bullish breakout and further upside potential.

Investors can buy the stock in the range of Rs. 245 to Rs. 230 for a target of Rs. 290 in short term, Rs. 335 in medium term and Rs. 380 and more in long term.

Disclaimer: This blog post is for informational purposes only and does not constitute any investment advice or recommendation. Investors should do their own research and analysis before making any investment decision.


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