+
NHAI Awards Fall to Seven Year Low as Focus Shifts to Debt Repayment
ROADS & HIGHWAYS

NHAI Awards Fall to Seven Year Low as Focus Shifts to Debt Repayment

Road building in India slowed sharply in the fiscal year ended March 2026 as national highway awards fell to their weakest level in seven years and construction activity returned to a level not seen since FY17, an analysis by Nuvama Institutional Equities found. The National Highways Authority of India awarded contracts for 3,124 km of road projects worth Rs 423 billion (Rs 423 bn) in FY26, up from 2,170 km worth Rs 470 bn in FY25 but well below the 6,300 km and nearly Rs 1.3 trillion (Rs 1.3 tn) in FY23.

When state-level awards are included, combined NHAI?plus?MoRTH awards in FY26 totalled 7,000 km, down from 7,538 km in FY25, a seven per cent year-on-year fall and far short of the more than 12,000 km awarded across FY22–23. Overall road construction declined 12 per cent year on year in FY26, after a 14 per cent fall in FY25. The report highlights persistent land acquisition delays that are lagging the pace of approvals.

The slowdown has structural implications for the commercial vehicle and construction equipment supply chain that supports highway building. Nuvama highlighted that listed developers' share of NHAI awards has shrunk from roughly 61 per cent in FY16–18 to 31 per cent in FY19–21 and to 25 per cent over FY22–25, with the share remaining at 25 per cent in FY26. Smaller unlisted players have been winning a larger slice of available work, reducing revenue visibility for listed firms.

NHAI's capital expenditure was roughly flat at Rs 2.4 trillion (Rs 2.4 tn) in FY26 while the agency's construction output fell about five per cent to 5,313 km, indicating a reallocation of funds. Asset monetisation raised around Rs 283 bn in FY26, slightly below earlier levels, and much of the proceeds is funding debt repayment as the debt to equity ratio fell to 0.17 times.

With a muted FY27 road outlay and the agency prioritising deleveraging over expansion, a near-term pickup in awards appears unlikely, the note suggested. Nuvama advised road developers to pursue segmental diversification as their ability to secure orders at desired margins is under question. The brokerage said it remained cautious on the roads sector given the subdued project pipeline and potential knock-on effects for allied industries.

Road building in India slowed sharply in the fiscal year ended March 2026 as national highway awards fell to their weakest level in seven years and construction activity returned to a level not seen since FY17, an analysis by Nuvama Institutional Equities found. The National Highways Authority of India awarded contracts for 3,124 km of road projects worth Rs 423 billion (Rs 423 bn) in FY26, up from 2,170 km worth Rs 470 bn in FY25 but well below the 6,300 km and nearly Rs 1.3 trillion (Rs 1.3 tn) in FY23. When state-level awards are included, combined NHAI?plus?MoRTH awards in FY26 totalled 7,000 km, down from 7,538 km in FY25, a seven per cent year-on-year fall and far short of the more than 12,000 km awarded across FY22–23. Overall road construction declined 12 per cent year on year in FY26, after a 14 per cent fall in FY25. The report highlights persistent land acquisition delays that are lagging the pace of approvals. The slowdown has structural implications for the commercial vehicle and construction equipment supply chain that supports highway building. Nuvama highlighted that listed developers' share of NHAI awards has shrunk from roughly 61 per cent in FY16–18 to 31 per cent in FY19–21 and to 25 per cent over FY22–25, with the share remaining at 25 per cent in FY26. Smaller unlisted players have been winning a larger slice of available work, reducing revenue visibility for listed firms. NHAI's capital expenditure was roughly flat at Rs 2.4 trillion (Rs 2.4 tn) in FY26 while the agency's construction output fell about five per cent to 5,313 km, indicating a reallocation of funds. Asset monetisation raised around Rs 283 bn in FY26, slightly below earlier levels, and much of the proceeds is funding debt repayment as the debt to equity ratio fell to 0.17 times. With a muted FY27 road outlay and the agency prioritising deleveraging over expansion, a near-term pickup in awards appears unlikely, the note suggested. Nuvama advised road developers to pursue segmental diversification as their ability to secure orders at desired margins is under question. The brokerage said it remained cautious on the roads sector given the subdued project pipeline and potential knock-on effects for allied industries.

Related Stories

Gold Stories

Next Story
Infrastructure Urban

India’s Global CE Connect

India’s construction equipment industry is entering a phase where scale is increasingly being matched by productivity, technology, localisation and lifecycle economics. Against this backdrop, bauma ConExpo India 2026, scheduled for September 15-18 at the India Expo Centre, Greater Noida, will bring the global and Indian construction machinery ecosystem together.The eighth edition is expected to be the largest yet, with the exhibition sold out across around 1.45 million sq ft. More than 1,100 exhibitors from over 100 countries are expected to participate, with visitor numbers projected to exc..

Next Story
Real Estate

Orris, Godrej Properties Settle Dispute Over Gurugram Project

Orris Infrastructure and Godrej Properties Limited have reached an amicable settlement over matters related to the jointly developed Godrej Air project in Gurugram, bringing an end to the dispute between the two companies.The Bombay High Court, while hearing a petition filed by Orris Infrastructure, ordered the immediate and unconditional release of Orris Managing Director Amit Gupta on August 25, 2026, after being informed about the settlement agreement between the parties.A single-judge bench led by Justice Milind N. Jadhav noted that in view of the settlement agreement signed by both compan..

Next Story
Infrastructure Urban

Panasonic Launches Second Cycle of Startup Co-Creation Programme

Panasonic Life Solutions India (PLSIND), through its IGNITION Open Innovation platform, has announced the second cycle of Co.lab Studio, a startup collaboration initiative focused on developing scalable digital services and solutions.The new cycle will focus on Safety & Security and Daily Living solutions for communities by leveraging Panasonic’s AI and IoT-enabled connected living platform, MirAIe. The programme aims to help startups move from innovation concepts to pilot deployments, platform integrations and commercialisation-ready solutions.The first cycle of Co.lab Studio received 1..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

SPECIAL OFFER
QR Code