KNR Constructions (532942) Q3 25/26 earnings summary

Executive summary

• Q3 and nine months FY 2026 saw muted execution due to a slowdown in project awards, especially in highways, but sector fundamentals remain strong with improving outlook and robust policy support.

• Received Letter of Acceptance for a Rs. 3,192 Mn bridge project in Hyderabad, with a 24-month timeline.

• Completed a major elevated highway project in Coimbatore, Tamil Nadu, with completion certificate received.

• Executed share purchase agreements to divest four SPVs, expecting Rs. 15,432 Mn in proceeds against Rs. 5,668 Mn investment.

• CRISIL reaffirmed/upgraded long-term and short-term ratings, removing rating watch and reflecting improved credit profile.

Financial highlights

• Standalone Q3 FY26 revenue: Rs. 5,851 Mn; EBITDA: Rs. 306 Mn (margin 5.2%); Net profit: Rs. 176 Mn.

• Standalone nine months FY26 revenue: Rs. 15,614 Mn; EBITDA: Rs. 1,498 Mn (margin 9.6%); Net profit: Rs. 968 Mn.

• Consolidated Q3 FY26 revenue: Rs. 7,432 Mn; EBITDA: Rs. 1,600 Mn (margin 22.4%); Net profit: Rs. 1,027 Mn.

• Consolidated nine months FY26 revenue: Rs. 20,024 Mn; EBITDA: Rs. 5,420 Mn (margin 27.1%); Net profit: Rs. 3,308 Mn.

• Standalone and consolidated revenues grew YoY, but standalone and consolidated net profits declined YoY.

Outlook and guidance

• Order book as of December 2025 stands at Rs. 88,488 Mn, diversified across roads, irrigation, pipelines, and mining, with 84% from third-party clients.

• Revenue for FY 2026 expected to be around Rs. 20,000 Mn, with similar levels projected for FY 2027 based on current order book.

• Order inflow target of Rs. 100,000-120,000 Mn by September 2027, focusing on NHAI, irrigation, and state government projects.

• EBITDA margin for FY 2027 expected at 9-10%, with potential recovery to 13-14% only from FY 2028 as new projects ramp up.

• Asset monetization of four SPVs expected to complete by September 2026, enhancing liquidity.