KRN Heat Exchanger and Refrigeration Limited
Value Pick Multibagger Stock for long term
Market Data
Market Metrics
Market Cap: ₹4,584 Cr
Current Price: ₹738
52-Week High/Low: ₹904 / ₹402
Key Ratios
Stock P/E: 115
Book Value: ₹80.5
Dividend Yield: 0.00%
Performance Metrics
ROCE: 42.1%
ROE: 41.9%
Promoter Holding: 70.8%
Q3 FY25 Financial Performance
Revenue: ₹9,109.59 Lakhs (YoY growth: 28.41%, QoQ growth: 15%)
EBITDA: ₹1,955.27 Lakhs (Margin: 21.17%)
Net Profit: ₹1,231.08 Lakhs (YoY growth: 42.98%)
Product-Wise Revenue Contribution (FY25)
Evaporator Coils
₹11,558.70 Lakhs
37.49% of Revenue
Condenser Coils
₹17,029.57 Lakhs
55.24% of Revenue
Other Segments
₹2,240.04 Lakhs
7.27% of Revenue
Future Growth Projections
Revenue FY25
₹35,000 Cr
Growth: +18% YoY
Revenue FY26
₹42,000 Cr
Growth: +20% YoY
EBITDA FY25
₹7,000 Cr
Margin: ~20%
EBITDA FY26
₹8,500 Cr
Margin: ~20.2%
Strategic Initiatives
Capacity Expansion
New facility under KRN HVAC Products
Target: 2 million units by FY27
R&D Investments
₹25 Lakhs annual investment
Focus on thermal efficiency
Customer Base Expansion
Target: 200+ clients
Across 12+ countries by FY26
Industry Outlook
Global Heat Exchanger Market
Expected CAGR: 6.2%
Market Size: $20 billion by 2030
Indian HVAC Market
Projected CAGR: 12.5%
Growth Drivers: Urbanization, infrastructure expansion, industrial activity
Risk Analysis
High Valuation
P/E of 115 implies high growth expectations
Customer Concentration
Top 10 customers contribute 75.94% of revenue
Export Challenges
Exposure to forex fluctuations and geopolitical risks
Valuation
DCF Valuation Parameters:
Terminal Growth Rate: 6%
Discount Rate: 10%
Intrinsic Value: ₹850
Upside Potential: ~15% from current price of ₹738
Investment Thesis
KRN Heat Exchanger represents a compelling growth opportunity in the HVAC&R sector, supported by:
• Strong demand growth in domestic and export markets
• Innovative product development and R&D focus
• Strategic expansion plans and operational efficiency
• Robust financial performance with improving margins
However, investors should consider the high valuation and customer concentration risks.
Disclaimer: This report is for informational purposes only and does not constitute investment advice. Investors are advised to conduct their due diligence and consult financial advisors before making investment decisions.