KNR Constructions saw its shares climb about 6% after it signed a deal to sell its highway assets to Indus Infra Trust, sparking interest among investors.
What the share purchase agreement means
The company announced that it will sell its entire 100% stake—including related sub‑debt—in four special purpose vehicles (SPVs) that own highway projects. The four SPVs are:
- KNR Palani Infra Private Limited
- KNR Ramagiri Infra Private Limited
- KNR Guruvayur Infra Private Limited
- KNR Ramanattukara Infra Private Limited
Under the agreement, KNR Constructions plans to invest about ₹566.83 crore (through equity and sub‑debt) in these SPVs and expects to receive roughly ₹1,543.19 crore as payment. The sale will go ahead once the required approvals from lenders and authorities are obtained, and it should be completed by 30 September 2026.
Recent financial performance
Despite the upbeat news, the company’s latest quarterly results showed a sharp decline:
- Net profit fell 76.3% year‑on‑year to ₹104.65 crore.
- Revenue dropped 66.8% to ₹646.5 crore.
- EBITDA slipped 77.8% to ₹192.82 crore.
The dip was mainly due to slower project execution and the lack of one‑off income that boosted the same quarter last year.
Share price movement
The stock opened at ₹183.91 on Friday, up from ₹171.02 the previous close, and has risen as much as 26% over the last five trading sessions. However, the broader trend remains negative:
- Down about 21% in the past six months.
- Down about 43% over the last year.
- 52‑week high: ₹356.70 (January 6).
- 52‑week low: ₹141.30 (December 18).
What investors should consider
The agreement could bring fresh capital and potentially improve the company’s project pipeline, which may support the share price in the future. At the same time, the recent earnings slump signals that the business is facing short‑term challenges. Investors might want to weigh the upside of the upcoming asset sale against the current financial weakness before making a decision.
Remember, this is perspective, not a prediction. Do your own research and consider consulting a financial adviser before acting.