KNR Construct. (KNRCON)

FairStock Score: 56/100 — STEADY

Score breakdown: P/E: 3/3 · ROCE: 2/2 · Growth: 0/2 · Dividend: 0/1

Key Financials

Strengths

• Trades below book value: P/B 0.93 against book value of ₹131.88
• Low P/E of 6.86 offers apparent valuation comfort
• ROCE of 28.58% suggests decent capital efficiency before financing costs
• Promoter holding of 48.81% aligns management with minority shareholders
• Moderate leverage with Debt/Equity at 0.49

Concerns

• Sales down 12.37% and profit down 58.65%
• Piotroski F-Score of 3/9 indicates weak financial health
• ROE of just 4.67% is poor and inconsistent with the high reported ROCE
• Dividend yield of 0.19% provides little compensation while waiting

AI Analysis

At ₹122.35, KNR Construct sells at 6.86 times earnings and 0.93 times book, while book value is ₹131.88. That seems like the kind of bargain Graham taught us to look for. But a cheap statistic is not a sufficient reason to buy. Business quality first: civil construction is highly competitive, with limited pricing power. There is no durable consumer moat; competitive advantage comes from execution, government order flow and balance-sheet discipline. Here, the financial health raises alarms. Sales have contracted 12.37% and profits 58.65%. Piotroski score is only 3 out of 9, which historically signals weak fundamentals. ROE is a thin 4.67%, even though ROCE stands at 28.58% — a glaring gap that needs forensic accounting attention. Debt-equity is 0.49, manageable, but the negligible dividend yield of 0.19% means minority shareholders receive little while waiting. The latest quarter shows ₹743 Cr sales and ₹103 Cr net profit, so the business is not dead; but one quarter does not reverse a downtrend. At 48.81%, promoter holding is decent. Yet in a cyclical industry with falling revenue and earnings, a low P/B can be a value trap. I need proof that book value is real, the order book is rebuilding, and return on equity returns to acceptable levels. Given these numbers, I would not classify KNR as a stalwart or fast grower. It is a cyclical strain with a potential turnaround only if execution and profitability stabilise. I will keep it on the watchlist, not rush in.

Data from BSE/NSE filings. AI analysis is for educational purposes only — not investment advice. Scoring methodology · Disclaimer