KNR Constructions Ltd Q1 FY27 Earnings Analysis

- FY27 revenue target: Around INR 2,200 to 2,300 crores, slightly higher than INR 2,000 crores in FY26. - FY28 revenue target: Above INR 3,000 crores, with significant execution from newly awarded HAM projects. - Mining project expected to contribute INR 300-400 crores revenue in FY28, ramping up to INR 1,000 crores in fifth year. - Execution from two new HAM projects targeted at INR 1,000-1,200 crores in FY28. - Overall order book expected to grow to INR 18,000-19,000 crores by end of FY27. - Strong order inflow pipeline of INR 8,000-10,000 crores for FY27, including mining, roads, and NHAI HAM projects. - Margins anticipated around 10-11% EBITDA with competition leading to tighter pricing but focus on productivity improvements.

- KNR Constructions targets revenue growth from around INR2,000 crores in FY26 to INR2,200-2,300 crores in FY27, and aims for INR3,000+ crores in FY28. - EBITDA margins are expected to be maintained around 10%-11% in FY27 and likely similar in FY28, despite more competitive bidding and tighter margins. - The company anticipates steady execution from HAM projects, with INR1,000-1,200 crores revenue from two HAMs in FY28. - Mining projects are expected to contribute INR300-400 crores in FY28, peaking later at INR1,000 crores annual turnover. - Order inflow target for next year is INR8,000-10,000 crores, including mining, roads, irrigation, and NHAI projects. - The broader opportunity in infrastructure sectors like mining, irrigation, and rail connectivity is expected to support sustained growth. - New orders and improved execution efficiency are expected to underpin gradual earnings growth despite industry challenges.

- Capex in FY26 was around INR4 crores, with almost no significant capex in Q4 FY26. (Page 17) - Targeted capex for FY27 is low since the existing capex is sufficient for ongoing projects. (Page 16) - Planned capex of INR200-250 crores expected related to mining projects when they start. (Page 14) - Mining project capex (~INR350 crores) to be funded at standalone level using internal accruals or debt; mining revenue expected from Q4 FY27 or FY28. (Page 11) - Exploring land acquisition for solar projects, with ongoing efforts in Maharashtra and Karnataka for large-scale solar EPC projects (above 500 MW). (Page 16-17) - Discussions underway for data center projects near Hyderabad, with strategic partnerships and EPC by KNR planned. (Page 16-17)

- Mining project capex will be funded at the parent company level, using internal accruals or potentially higher purchase loans. - A monetization proposal is underway to support funding requirements. - No explicit mention of new equity fundraising. - The company is leveraging internal accruals and considering new debt for capex and project funding. - Existing capex for current projects is deemed sufficient, with no major additional capex anticipated in the near term. - No specific plans disclosed regarding any fresh large-scale debt or equity raise beyond the mining project funding arrangements.

- As of March 31, 2026, total order book stands at INR 8,672 crores (excluding recent HAM projects). - Including newly won HAM projects, total order book rises to INR 11,903 crores. - Order book composition: 49% roads, 14% irrigation, 7% pipeline, 30% mining projects. - Client-wise: 61% third-party clients, 39% captive HAM projects. Among third-party, 59% state government, 1% central government, 1% private. - Execution timeline: orders to be executed over 3 to 3.5 years excluding mining. - Pipeline for FY27 includes bids worth INR 4,000 crores (GHMC, mining, Northeast NHAI HAM). - Additional bids of INR 4,000-5,000 crores targeted for FY27. - Overall, pipeline projects and bids could take order book to INR 18,000-19,000 crores by FY27 end. - Target order inflows for FY27: INR 8,000 to INR 10,000 crores. - Unbilled revenue: approximately INR 800 crores in irrigation and INR 500 crores in roads.