Road Construction to Dip in FY26
ROADS & HIGHWAYS

Road Construction to Dip in FY26

India’s road construction pace is set to slow down in FY26, with the Ministry of Road Transport and Highways (MoRTH) expected to build 9,500-10,000 km, marking a 5% decline from the estimated 10,000-10,500 km in FY25, according to ICRA. The slowdown is attributed to reduced project awarding over the past two years.

In the first nine months of FY25, MoRTH awarded just 3,100 km of projects, significantly lower than the 5,835 km awarded in the same period of FY23. However, a recent pickup in awarding since November 2024 could push project awards to 8,500-9,000 km in FY25, with potential growth of 9-11% in FY26 if the momentum continues.

“With awarding expected to improve only in FY26, road developers may see subdued revenue growth over the next 12-15 months,” said Vinay Kumar G, Sector Head, Corporate Ratings, ICRA, noting that competition will remain high as firms aggressively bid for limited projects.

Meanwhile, toll collection growth is set to moderate due to slower expansion in the construction, manufacturing, and mining (CMM) sectors. Traffic growth is likely to ease to 2-3.5% in FY25, with toll revenue rising 5-7%. In FY26, an expected 3.5-4.2% increase in toll rates and 3-5% traffic growth could drive toll collections up 7-9%, the report added.

India’s road construction pace is set to slow down in FY26, with the Ministry of Road Transport and Highways (MoRTH) expected to build 9,500-10,000 km, marking a 5% decline from the estimated 10,000-10,500 km in FY25, according to ICRA. The slowdown is attributed to reduced project awarding over the past two years. In the first nine months of FY25, MoRTH awarded just 3,100 km of projects, significantly lower than the 5,835 km awarded in the same period of FY23. However, a recent pickup in awarding since November 2024 could push project awards to 8,500-9,000 km in FY25, with potential growth of 9-11% in FY26 if the momentum continues. “With awarding expected to improve only in FY26, road developers may see subdued revenue growth over the next 12-15 months,” said Vinay Kumar G, Sector Head, Corporate Ratings, ICRA, noting that competition will remain high as firms aggressively bid for limited projects. Meanwhile, toll collection growth is set to moderate due to slower expansion in the construction, manufacturing, and mining (CMM) sectors. Traffic growth is likely to ease to 2-3.5% in FY25, with toll revenue rising 5-7%. In FY26, an expected 3.5-4.2% increase in toll rates and 3-5% traffic growth could drive toll collections up 7-9%, the report added.

Related Stories

Gold Stories

Next Story
Infrastructure Urban

Vedanta Metal Bazaar Expands to Global Markets

Vedanta Aluminium has expanded its digital e-commerce platform, Vedanta Metal Bazaar, to international markets, enabling overseas customers to order and purchase aluminium products online.The platform will now be available to buyers across Asia, Europe, Africa and the Americas, providing a digital gateway for export transactions with 24x7 access.In FY26, Vedanta Metal Bazaar processed transactions worth nearly $4.1 billion, or over Rs 380 billion, and fulfilled more than 23,000 orders. The platform is also used regularly by more than 550 MSMEs in India alongside large OEM customers.The export ..

Next Story
Infrastructure Urban

Ramky Infrastructure Q1 FY27 Revenue Rises 24.3%

Ramky Infrastructure Limited reported a 24.3% year-on-year increase in consolidated revenue from operations to Rs 471.2 crore for Q1 FY27, compared with Rs 3.79 billion in the corresponding quarter of FY26.Standalone revenue from operations rose 27.5% YoY to Rs 4.51 billion from Rs 3.54 billion, while total standalone income increased 35% to Rs 5.32 billion.Consolidated profit before tax stood at Rs 540.9 million during the quarter. The company highlighted a sharp sequential improvement compared with a pre-exceptional loss of Rs 190.1 million in Q4 FY26.Two of the three projects awarded during..

Next Story
Technology

LTTS Launches AgenticIQ AI Platform for Engineering

L&T Technology Services (LTTS) has launched AgenticIQ, an end-to-end agentic AI platform designed for engineering and manufacturing organisations.The platform is aimed at helping enterprises move beyond isolated AI pilots by enabling autonomous, multi-agent workflows across engineering, product development, manufacturing, industrial operations and customer experience.AgenticIQ is built on LTTS’ Engineering Intelligence portfolio and converts existing engineering capabilities into specialised, reusable AI agents. Its planning-first architecture is embedded into engineering and production ..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement