+
Tough Bidding Norms Slow NHAI Road Project Awards
ROADS & HIGHWAYS

Tough Bidding Norms Slow NHAI Road Project Awards

Stringent bidding rules imposed by the Ministry of Road Transport & Highways (MoRTH) have led to a slowdown in project awards by the National Highways Authority of India (NHAI), despite a robust Rs 3.5 trillion pipeline. According to an HDFC Securities report, the shift to more cautious developer models now favours firms with strong balance sheets, as tighter qualification norms limit aggressive bidders.
The revised norms mandate additional performance security, targeting the exclusion of players that previously submitted low bids—often 25 to 40 per cent below NHAI cost estimates—raising concerns over long-term road quality. This has particularly impacted small, unlisted firms that had earlier dominated bidding due to relaxed entry barriers.
While sectors such as buildings, power transmission, and urban infrastructure have recently seen stronger order flows, road construction activity has markedly declined. This has affected the revenue visibility and valuations of construction firms heavily reliant on highway contracts.
The report suggests that engineering, procurement, and construction (EPC) players could mitigate risk by diversifying into solar energy, battery energy storage systems (BESS), river interlinking, and transmission. A recovery in order flow, it notes, would support sectoral re-rating, especially for diversified infrastructure players positioned beyond roads.

Stringent bidding rules imposed by the Ministry of Road Transport & Highways (MoRTH) have led to a slowdown in project awards by the National Highways Authority of India (NHAI), despite a robust Rs 3.5 trillion pipeline. According to an HDFC Securities report, the shift to more cautious developer models now favours firms with strong balance sheets, as tighter qualification norms limit aggressive bidders.The revised norms mandate additional performance security, targeting the exclusion of players that previously submitted low bids—often 25 to 40 per cent below NHAI cost estimates—raising concerns over long-term road quality. This has particularly impacted small, unlisted firms that had earlier dominated bidding due to relaxed entry barriers.While sectors such as buildings, power transmission, and urban infrastructure have recently seen stronger order flows, road construction activity has markedly declined. This has affected the revenue visibility and valuations of construction firms heavily reliant on highway contracts.The report suggests that engineering, procurement, and construction (EPC) players could mitigate risk by diversifying into solar energy, battery energy storage systems (BESS), river interlinking, and transmission. A recovery in order flow, it notes, would support sectoral re-rating, especially for diversified infrastructure players positioned beyond roads.

Related Stories

Gold Stories

Next Story
Real Estate

Peninsula Land launches 19 luxury villas in Pune

Pune’s residential landscape is witnessing a shift as premium homebuyers increasingly seek larger spaces, privacy and independent living options beyond high-rise apartments. Addressing this demand, Peninsula Land Limited, part of the Ashok Piramal Group, has launched AshokVillas, an exclusive collection of 19 premium furnished villas in Gahunje, Pune.The development combines the independence of a standalone home with the convenience and security of a managed residential community. Designed around low-density horizontal living, AshokVillas offers residents private spaces while providing acces..

Next Story
Infrastructure Urban

MyBranch Expands South India Network with 16 Workspace Centres

MyBranch has expanded its South India presence with a 50,000 sq ft flexible workspace network comprising 16 centres across 14 cities in Andhra Pradesh, Karnataka, Tamil Nadu and Telangana.The expansion reflects growing demand for flexible office infrastructure as businesses establish regional teams, satellite offices and operations beyond traditional metropolitan markets. MyBranch’s network spans Bengaluru, Coimbatore, Guntur, Hanamkonda, Hubballi, Hyderabad, Madurai, Mangaluru, Rajahmundry, Salem, Tirupati, Vellore, Vijayawada and Visakhapatnam, with a large office space in Chennai also und..

Next Story
Building Material

Walplast Launches Moisture-Resistant Gypsum Plaster Solutions

Walplast Products Pvt. Ltd. has expanded its HomeSure GypEx portfolio with the launch of GypEx MoistShield and GypEx Gold, two gypsum plaster solutions designed to address moisture-prone applications and improve plastering efficiency.The new products have been developed in response to the growing demand for faster construction processes, improved material performance and consistent surface quality. The solutions aim to simplify interior plastering while addressing specific application requirements across construction environments.“Through HomeSure GypEx MoistShield and GypEx Gold, we are exp..

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

SPECIAL OFFER
QR Code