KNRC delivered muted 3QFY16 EBITDA/RPAT, 3.2/23.4% below our estimates. EBITDA margins expanded 153bps to 15.6% (194bps contraction in material expenses). The balance sheet is healthy with standalone net debt at Rs 860mn (Rs 460mn increase QoQ, including Rs 785mn promoter?s loan) and net D/E at 0.14x (vs. 0.06x end-2QFY16).