Indian Railways Revamps Station Redevelopment Unlocking Rs 300 Bn
RAILWAYS & METRO RAIL

Indian Railways Revamps Station Redevelopment Unlocking Rs 300 Bn

Indian Railways is considering redeveloping a total of 1,318 railway stations under the Amrit Bharat Station Scheme. Initially, the government had planned to carry out most of these station redevelopment projects through the Public-Private Partnership (PPP) model, which was expected to contribute approximately 12 per cent to the National Monetisation Pipeline (NMP) target. However, limited participation in PPP projects—due to factors like pricing restrictions, market risks related to real estate development, and a lack of a solid track record in railway PPPs—led the government to shift to the Engineering, Procurement, and Construction (EPC) model for station redevelopment in December 2022. To support this transition, the budget allocation increased significantly, from Rs 21.59 billion in FY2023 to Rs 155.11 billion in the FY2025 Budget Estimates (BE), with expectations for continued strong funding in the medium term.

According to ICRA, EPC companies now stand to gain business opportunities worth Rs 300 billion over the next two years related to railway station redevelopment. Vinay Kumar G, Sector Head for Corporate Ratings at ICRA, noted that while competition remains intense in traditional sectors like roads and buildings, the redevelopment of railway stations presents substantial growth opportunities for construction companies, estimated at Rs 300 billion. He emphasised that this sector provides a chance for companies to expand and mitigate risks by diversifying.

Over the past two years, tenders for station redevelopment projects have faced moderate competition, with discounts of up to 18 per cent, and the median discount standing at about 4 per cent. This trend mirrors other railway EPC projects, where the median discount is around 5 per cent. Given that Indian Railways is considered a reliable counterparty, the receivable cycle is expected to be short, similar to that of the National Highways Authority of India (NHAI).

Key railway stations awarded redevelopment under the EPC model include Mumbai’s Chhatrapati Shivaji Maharaj Terminal (CSMT), Ahmedabad, Surat, Prayagraj, Bangalore Cantt, Chennai Egmore, and Secunderabad, among others. Additionally, tenders for 765 more stations are still pending, with notable stations such as New Delhi, Pune, Borivali, Mumbai Central, Thane, and Amritsar yet to be awarded.

Indian Railways is considering redeveloping a total of 1,318 railway stations under the Amrit Bharat Station Scheme. Initially, the government had planned to carry out most of these station redevelopment projects through the Public-Private Partnership (PPP) model, which was expected to contribute approximately 12 per cent to the National Monetisation Pipeline (NMP) target. However, limited participation in PPP projects—due to factors like pricing restrictions, market risks related to real estate development, and a lack of a solid track record in railway PPPs—led the government to shift to the Engineering, Procurement, and Construction (EPC) model for station redevelopment in December 2022. To support this transition, the budget allocation increased significantly, from Rs 21.59 billion in FY2023 to Rs 155.11 billion in the FY2025 Budget Estimates (BE), with expectations for continued strong funding in the medium term. According to ICRA, EPC companies now stand to gain business opportunities worth Rs 300 billion over the next two years related to railway station redevelopment. Vinay Kumar G, Sector Head for Corporate Ratings at ICRA, noted that while competition remains intense in traditional sectors like roads and buildings, the redevelopment of railway stations presents substantial growth opportunities for construction companies, estimated at Rs 300 billion. He emphasised that this sector provides a chance for companies to expand and mitigate risks by diversifying. Over the past two years, tenders for station redevelopment projects have faced moderate competition, with discounts of up to 18 per cent, and the median discount standing at about 4 per cent. This trend mirrors other railway EPC projects, where the median discount is around 5 per cent. Given that Indian Railways is considered a reliable counterparty, the receivable cycle is expected to be short, similar to that of the National Highways Authority of India (NHAI). Key railway stations awarded redevelopment under the EPC model include Mumbai’s Chhatrapati Shivaji Maharaj Terminal (CSMT), Ahmedabad, Surat, Prayagraj, Bangalore Cantt, Chennai Egmore, and Secunderabad, among others. Additionally, tenders for 765 more stations are still pending, with notable stations such as New Delhi, Pune, Borivali, Mumbai Central, Thane, and Amritsar yet to be awarded.

Next Story
Real Estate

Mahindra Lifespaces Bags Rs 12.5 billion Redevelopment in Mulund

Mahindra Lifespace Developers (MLDL), the real estate and infrastructure development arm of the Mahindra Group, has been appointed as the preferred developer for the redevelopment of a premium housing society in Mulund (West), Mumbai. The project will be developed across a 3.08-acre land parcel, with an estimated development value of approximately Rs 12.5 billion. Strategically located, the site enjoys proximity to major connectivity points—just 1.4 km from the upcoming Mumbai Metro Line 5 and 0.8 km from the Goregaon-Mulund Link Road. It also offers seamless access to the Eastern Expre..

Next Story
Infrastructure Urban

Snowman Adds Warehouses in Kolkata and Krishnapatnam

Snowman Logistics, India’s leading integrated temperature-controlled logistics company, has announced the commencement of operations at its two new state-of-the-art, owned cold storage facilities in Kolkata and Krishnapatnam. With these additions, the company’s total pallet capacity has reached 1,50,754, spanning 43 warehouses in 20 cities across the country. The newly operational Kolkata facility offers a storage capacity of 5,630 pallets, while the Krishnapatnam facility holds 3,927 pallets. These warehouses are equipped with advanced automation and infrastructure designed to enhanc..

Next Story
Resources

Noesis Enables IHCL Hotel Deal in Udupi–Manipal Corridor

NOESIS Capital Advisors, India’s leading hotel investment advisory firm, has successfully facilitated a landmark hospitality transaction in the Udupi–Manipal region of Karnataka. The deal involves the acquisition of a nearly completed, 130-key upscale hotel that will operate under one of the premium brands of IHCL, reinforcing NOESIS’ position as a preferred partner for strategic hospitality transactions across India. Strategically located on the Udupi–Manipal Highway, the 1.03-acre property will cater to business travellers, pilgrims and families visiting Manipal University. With..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?