KNR Q4FY16 operational performance was better than our estimate on account of better execution and higher than expected margins. Revenue of Rs 2.94bn (+15% YoY) and EBITDA of Rs 451mn (+30% YoY) came higher than our respective estimates of Rs 2.6bn/Rs 353mn. EBITDA margin stood at 15.3% (+168bps YoY), higher than our estimate of 13.5%. Reported PAT increased sharply by 138% YoY to Rs580 mn (much higher than our estimate of Rs 153mn) primarily led by expansion in EBITDA margin coupled with higher other income (includes Rs 58.6 mn related to interest on income tax refunds) and tax reversal for prior periods. For FY16, revenue increased by 3% YoY to Rs 9.0 bn; EBITDA margin improved by 282 bps to 17.2% leading to a bottom line of Rs 1.6bn (+120% YoY). Maintain Buy with TP of Rs 740.