Update on KNR Construction Ltd by Motilal Oswal
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Robust performance
4QFY22 earnings snapshot
* Revenue grew 8% YoY and 32% QoQ to ~INR10.1b in 4QFY22, 7% above our estimate.
* EBITDA margin was a robust 21% in 4QFY22 (+111bp YoY), driven by increasing execution in the high margin Irrigation segment.
* EBITDA/PAT grew 14%/47% YoY to INR2.1b/INR1.1b (15%/11% above our estimate).
* The current order book stands ~INR90b (excluding recently won projects), with an order book-to-revenue ratio of 2.8x.
* The consolidated net debt stood at INR11.5b (FY21: INR5.7b). It continues to be debt-free at the standalone level.
* Net working capital reduced to 63 days at the end of FY22 (v/s 82 days at the end of FY21).
* KNRC acquired Manjeri City Infrastructures and Developers and Benedire Infrastructures and Developers for a total consideration of INR370m. This is to facilitate implementation of highway Construction projects in Kerala. The acquired companies have quarries, buildings, and crusher plants with requisite licenses and approvals, which will be used for the execution of projects in Kerala.
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