FCC

ICRA envisages stable outlook for construction sector

2019-01-11

Rating agency ICRA estimates a stable outlook for the construction sector in India, supported with strong order inflow in the last couple of years and a huge pipeline of projects to be awarded in the infrastructure segment.

In the railways segment, besides the core capex, the station redevelopment and the bullet train project are expected to provide significant opportunities to the construction companies. Similarly, in the road sector, adequate pipeline of projects for development and upgradation of the national highways and state highways exists. The Rs 5.35 trillion Bharatmala Pariyojana project, as the largest road development programme in India, is expected to provide large opportunities for the construction sector. Furthermore, many road projects awarded in 2018 and awaiting appointed date are likely to start execution in CY2019.

In spite of the positive scenario, delays in land acquisition remain a risk to new order inflows, particularly in the transportation infrastructure sector, according to the agency.