KNR Constructions Limited , a prominent player in the infrastructure sector, has reported its financial results for the second quarter of fiscal year 2026, revealing a mixed performance amidst industry-wide challenges and ongoing projects.

Financial Performance

KNR Constructions reported the following standalone financial results for Q2FY26:

The company's performance reflects the current challenges in the infrastructure sector, including sluggish project awarding by the National Highways Authority of India (NHAI) and extended monsoon conditions affecting execution.

New Project Acquisitions

Despite the challenging environment, KNR Constructions has made progress in securing new projects:

1. Received a Letter of Acceptance (LOA) for two new EPC projects in Telangana, collectively worth INR 531.00 crores:

   • Construction of a three-lane flyover at Kukatpally Y-junction in Hyderabad (INR 72.00 crores)
   • Construction of multilevel flyovers at Khajaguda and IIIT junctions, including road widening and development (INR 459.00 crores)

2. The company is targeting new orders worth INR 8,000.00-10,000.00 crores by the end of FY26, focusing on a mix of NHAI projects, irrigation projects, and other state government initiatives.

Settlement with NHAI

KNR Constructions has reached a settlement agreement with NHAI for the Ramanattukara project:

• The company's subsidiary, KNR Ramanattukara Infra Private Limited, will construct a viaduct at its own cost, to be completed by February 20, 2026.
• NHAI has agreed to grant an extension of time without damages for the project work.
• The provisional completion certificate for the project, excluding the viaduct stretch, is set for July 18, 2025, without damages.

Order Book and Future Outlook

As of September 30, 2025, KNR Constructions' total order book stands at INR 8,748.00 crores, distributed across various sectors:

The company expects to execute this order book over the next 1.5 to 2 years, excluding the mining projects.

Challenges and Strategy

KNR Constructions faces several challenges in the current market scenario:

1. Sluggish project awarding by NHAI and state governments
2. Extended monsoon conditions affecting project execution
3. Delays in receivables from some state government projects

To address these challenges, the company is:

1. Diversifying its project portfolio across different infrastructure segments
2. Exploring partnerships with larger players for EPC contracts in BOT and HAM projects
3. Maintaining a strong focus on timely project execution and completion

Management Commentary

K. Jalandhar Reddy, Executive Director of KNR Constructions, commented on the current market conditions: "This is the worst time ever faced by us in such a situation. However, we are seeing some light with NHAI planning to come up with bigger scale projects. We are gearing up for the expected phase of tenders from January to March."

The management expects the company to return to its peak performance levels within the next 3 to 4 quarters, subject to market conditions and successful order inflows.

As KNR Constructions navigates through these challenging times, the company remains focused on efficient project execution, strategic order acquisition, and maintaining a strong balance sheet to capitalize on future growth opportunities in the infrastructure sector.

HDFC Mutual Fund, a prominent player in the Indian mutual fund industry, has reduced its shareholding in KNR Constructions Limited, a key player in the infrastructure sector. The fund house sold 40 lakh shares of the company through an open market transaction on November 11, 2025, resulting in a decrease in its stake from 5.81% to 5.45% of the company's paid-up equity share capital.

Transaction Details

This move by HDFC Mutual Fund is in compliance with the Securities and Exchange Board of India (SEBI) disclosure regulations, which require investors to report significant changes in their shareholdings in listed companies.

Recent Company Update

In a related development, KNR Constructions Limited has recently held an earnings call on November 13, 2025. The company has made the audio recording of this call available on its website, demonstrating its commitment to transparency and open communication with investors and analysts. Interested parties can access the recording at http://knrcl.com/transcriptofconcall.html .

This earnings call may provide valuable insights into the company's financial performance and future outlook, which could be of interest to investors in light of HDFC Mutual Fund's recent stake reduction.

Market Implications

The reduction in HDFC Mutual Fund's stake is a notable development for KNR Constructions. Investors may want to consider this move in the context of broader market trends and the company's performance. The infrastructure sector, in which KNR Constructions operates, is subject to various macroeconomic factors and government policies that can influence investor sentiment.

Investors and market watchers may want to monitor any further changes in institutional holdings of KNR Constructions, as well as the company's upcoming financial results and project pipeline, to gain a comprehensive understanding of its market position and future prospects.