CRISIL: ARCs to See 700-1000 bps Recovery from Stressed Roads This Fiscal
ROADS & HIGHWAYS

CRISIL: ARCs to See 700-1000 bps Recovery from Stressed Roads This Fiscal

According to a report by CRISIL Ratings, asset reconstruction companies (ARCs) are expected to see their cumulative recovery rate for stressed road projects increase by 700-1000 basis points (bps) this fiscal year, following a rise to 50-55 per cent last fiscal. The report explained that this improvement would be driven by faster completion or descoping of pending construction, leading to the initiation of annuities by the National Highways Authority of India (NHAI). This, in turn, would enable quicker resolutions or debt restructuring. Additionally, the report noted that a significant increase in toll collections is expected to support the recoveries.

CRISIL Ratings analyzed the security receipts (SRs) rated by the firm, which cover approximately 2,500 lane kilometres of stressed road projects, with a total principal debt of around Rs 60 billion (representing about 60% of the road assets held by ARCs). These projects include those under the build-operate-transfer (BOT) model and the hybrid annuity model under NHAI, which ARCs acquired at an average haircut of 40 per cent.

The report also highlighted that most of the projects in the CRISIL Ratings SR portfolio became stressed between 2017 and 2019 due to delays in land acquisition and obtaining Right of Way (RoW) by the government, as well as lower-than-expected toll collections. Among these, half of the projects have completed construction, while the pending RoW issues for the rest of the assets have been resolved.

According to a report by CRISIL Ratings, asset reconstruction companies (ARCs) are expected to see their cumulative recovery rate for stressed road projects increase by 700-1000 basis points (bps) this fiscal year, following a rise to 50-55 per cent last fiscal. The report explained that this improvement would be driven by faster completion or descoping of pending construction, leading to the initiation of annuities by the National Highways Authority of India (NHAI). This, in turn, would enable quicker resolutions or debt restructuring. Additionally, the report noted that a significant increase in toll collections is expected to support the recoveries.CRISIL Ratings analyzed the security receipts (SRs) rated by the firm, which cover approximately 2,500 lane kilometres of stressed road projects, with a total principal debt of around Rs 60 billion (representing about 60% of the road assets held by ARCs). These projects include those under the build-operate-transfer (BOT) model and the hybrid annuity model under NHAI, which ARCs acquired at an average haircut of 40 per cent.The report also highlighted that most of the projects in the CRISIL Ratings SR portfolio became stressed between 2017 and 2019 due to delays in land acquisition and obtaining Right of Way (RoW) by the government, as well as lower-than-expected toll collections. Among these, half of the projects have completed construction, while the pending RoW issues for the rest of the assets have been resolved.

Next Story
Real Estate

Vikas Jain named President of NAREDCO Maharashtra NextGen

Vikas Jain, CEO of Labdhi Lifestyle, has been appointed President of NAREDCO Maharashtra NextGen, succeeding Ridham Gada, who now serves as Vice-Chairman. Jain, a first-generation developer and turnaround specialist, aims to steer the youth wing of NAREDCO Maharashtra through a finance-driven and tech-enabled growth phase. Under his leadership, the association will prioritise project financing, RERA compliance, technology adoption, and future-ready leadership. “It is an honour to lead NAREDCO Maharashtra NextGen. This platform empowers the next generation of real estate leaders,” Jain sai..

Next Story
Infrastructure Energy

TP Solar Crosses 4 GW Solar Output at Tamil Nadu Plant

TP Solar Limited, a wholly owned subsidiary of Tata Power Renewable Energy Limited (TPREL) and the manufacturing division of Tata Power, has announced a major production milestone—crossing 4 GW of solar module output at its advanced facility in Tamil Nadu.As of 31 May 2025, the plant has cumulatively manufactured 4.049 GW of solar modules and 1.441 GW of solar cells. This milestone underscores the company’s growing role in supporting India’s clean energy transition and self-reliance in renewable energy manufacturing.Looking ahead, TP Solar is targeting 3.7 GW of solar cell output and 3.7..

Next Story
Infrastructure Urban

Aayush Art and Bullion Reports 1000 per cent Rise in FY25 Revenue

Aayush Art and Bullion Ltd (BSE: 540718), formerly AKM Creations Ltd, has announced its audited standalone financial results for H2 and the full financial year ending 31 March 2025, showcasing a sharp surge in both revenue and profitability. The company attributes this stellar performance to robust demand across its key verticals and strategic execution initiatives.For FY25, the company reported revenue of Rs 737.7 million, marking a 1,000 per cent year-on-year increase compared to Rs 73.3 million in FY24. Net profit for FY25 stood at Rs 18.1 million, a jump of 696 per cent over the Rs 2.6 mil..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?