Workers working at a road construction site in Kolkata, West Bengal, India. (Photographer: Prashanth Vishwanathan/Bloomberg)

Kotak Securities Sees Pick-Up In Road Construction Orders In FY19

Most major construction companies have have either matched or exceeded order wins in the first 11 months of this financial year compared to the previous year. And the pace of orders will only get better, according to Aditya Mongia, research analyst at Kotak Securities.

Mongia expects another Rs 15,000-20,000 crore worth of orders in March and another Rs 1 lakh crore worth of tenders to get converted into orders in the first half of next financial year. The real pick-up will be seen in FY19 as the National Highways Authority of India has already fallen short of its target in the first nine months of FY18 owing to the Goods and Services Tax and other issues, he added.

Dilip Buildcon, Sadbhav Engineering, KNR Construction, Ashoka Buildcon and PNC Infratech are better placed to receive new orders given their balance sheet strength, according to him. ToT (toll-operate-transfer) projects could become the preferred model for both NHAI and road construction companies, Mongia said.