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Roads And Construction Sector: Healthy Pipeline To Concretize Contractor’s Position, Says ICICI Direct

Roads And Construction Sector: Healthy Pipeline To Concretize Contractor’s Position, Says ICICI Direct



Traffic moves along National Highway 7 as road construction takes place in Bangalore, India, (Photographer: Namas Bhojani/Bloomberg)
Traffic moves along National Highway 7 as road construction takes place in Bangalore, India, (Photographer: Namas Bhojani/Bloomberg)

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

ICICI Direct Report

The roads and highways sector has demonstrated strong resilience to the Covid-19 disruptions with robust ordering activities (National Highways Authority of India awarded 1,330 kilometres in H1 FY21; up 1.6 times YoY) and improving construction pace.

Additionally, measures such as:

  1. Shifting from milestone-based billing to monthly billing

  2. Releasing of retention money/performance security in proportion to execution

  3. Faster resolution of disputes through reconciliation

  4. Revision of model concession agreement for hybrid annuity mode and build-operate-transfer projects ensured continuance of gained momentum and safeguarded contractor’s interest in the uncertain times.

Click on the attachment to read the full report:

ICICI Direct Road Construction Sector Update.pdf

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