The Ministry of Road and Transport under the Bharatmala Pariyojana Project (BPP) plans to award ~35000kms of roads at an outlay of ~Rs5.3tn over the next 3-4 years.
Overall order awarding for NHAI is steady at ~4300kms since last two years,However, the recent announcement under BPP can change ordering momentum for NHAI for the next few years after a phase of consolidation. Our interaction with industry participants indicates better planning and preparedness to improve ordering.
Margin for contractors could also go up as ability to choose projects increases with increased ordering. We continue to like players with a strong track record of execution and large balance sheet to support/fund large projects wins.
We continue to maintain “BUY” on SADE and ASBL with a revised PT of Rs 425 and Rs 287 respectively. In this report, we analyse the opportunity that exists for the players.
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