Which Companies Make Roads and Highways in India?

India is on a massive road building spree.

From ambitious government projects like Bharatmala Pariyojana to private companies driving innovation, the roads and highways sector is undergoing a revolution.

Major construction sites are alive with activity post elections, as new highways and expressways spring up, connecting regions and fueling economic growth.

Some of the notable efforts include -

Bharatmala Pariyojana: As of December 2023, 76% of the targeted 34,800 km of highways under Phase-I have been awarded, with 15,549 km completed. The project has seen an investment of Rs 4.23 lakh crore and is expected to generate substantial employment.

Private Sector Involvement: The government has increasingly involved private players in the construction and maintenance of highways, using models like the toll-operator-transfer (TOT) to fund the projects.

Sagarmala Project: This initiative complements the road network by focusing on coastal areas, aiming to modernise ports and improve logistics efficiency.

NH Network: India's road network has expanded by around 59% in only nine years, surpassing all except China's.

We can expect the pace of road construction to pick up massively from the next month onwards as the monsoon ends.

Here are the top companies that are involved in building roads and highways in India.

#1 Larsen & Toubro (L&T)

L&T ranks among the top contractors across the world.

It's a powerhouse in India's infrastructure sector, with a vast portfolio that spans across engineering, construction, manufacturing, and financial services.

In the roads and highways sector, L&T has consistently delivered large-scale projects, demonstrating its expertise in complex and high-value engineering works.

The recent award of the Gorakhpur Link Expressway project in Uttar Pradesh, part of the ambitious Bharatmala Pariyojana, highlights L&T's continued dominance in the sector. This project, valued at several thousand crores, is a testament to L&T's strong execution capabilities.

The company's division, L&T Construction, has also been awarded several contracts from the Mumbai Metropolitan Region Development Authority (MMRDA) including the construction of an Underground Road tunnel project in Mumbai.

The company's growth is bolstered by its diversified business model, which mitigates risks and ensures a steady revenue stream from various sectors.

Looking ahead, L&T is focusing on expanding its international presence, particularly in high-growth markets like the Middle East and Africa, while also investing in digital technologies to enhance operational efficiency and sustainability.

To know more about L&T, checkout its factsheet and latest quarterly results.

#2 IRB Infrastructure Developers Ltd (IRB Infra)

IRB Infra is a leading player in India's highway development sector, with a focus on Build-Operate-Transfer (BOT) projects.

The company has a strong track record of developing and operating some of India's most crucial highways, which are integral to the country's economic growth.

The company owns and manages around 12,000-lane km roads across ten states. It also has a 20% share in the golden quadrilateral highway.

Its primary clients are the Ministry of Road Transport and Highways (MoRTH) and the National Highway Authority of India (NHAI).

Recently, IRB Infra successfully completed a rights issue of Rs 26.5 bn, one of the largest in its history, to fund new and ongoing projects. This capital raise is expected to enhance IRB Infra's financial flexibility and support its expansion plans.

The company is currently involved in several high-profile projects under the Bharatmala Pariyojana, reinforcing its market position.

IRB Infra's strategy revolves around maintaining a balanced portfolio of toll and annuity-based projects, ensuring stable cash flows and long-term growth.

The company stands out in its segment as it has low dependency on external subcontracting. Usually, companies like IRB subcontract orders for execution.

To know more about IRB Infrastructure Developers, checkout its factsheet and latest quarterly results.

#3 Engineers India Ltd (EIL)

Engineers India Ltd (EIL), originally established to provide engineering consultancy and project management services to the oil and gas sector, has successfully diversified into infrastructure development, including roads and highways.

The company's expertise in project management and engineering makes it a valuable partner for both public and private sector clients.

EIL's growth prospects are closely linked to India's ambitious infrastructure development plans, particularly in the energy and transportation sectors.

It serves Indian and overseas clients, including ONGC, GAIL, NMDC, and Qatar Petroleum.

Engineers India has a substantial order book as of June 2024.

With 30% of orders from the private sector and 70% from the public sector, the company demonstrates its ability to cater to various client needs.

Some of the key projects include refinery expansions, high-speed railways, smart cities, and renewable energy initiatives such as solar, wind, and hydrogen.

Its strategic international presence, especially in the Middle East, further strengthens its order book.

To know more, check out Engineers India's financial factsheet and latest quarterly results.

#4 PNC Infratech Ltd.

PNC Infratech is a leading infrastructure construction company with a significant presence in the road and highway sector.

The company has a proven track record of executing large-scale projects, such as the Purvanchal Expressway, which is one of the most significant infrastructure projects in Uttar Pradesh.

The company also bagged a hybrid annuity road project some months ago worth Rs 11.7 bn from Madhya Pradesh Road Development Corporation (MPRDC).

PNC Infratech is well-positioned to benefit from the Indian government's continued investment in road infrastructure, particularly under the Bharatmala Pariyojana.

The company is also exploring opportunities to diversify into other areas of infrastructure, such as urban development and water supply projects.

To know more, check out PNC Infratech financial factsheet and its latest quarterly results.

#5 H.G. Infra Engineering Ltd.

H.G. Infra Engineering is an emerging player in the Indian infrastructure sector, with a focus on road and highway construction.

The company has rapidly expanded its operations, winning several contracts for highway construction in states like Rajasthan and Uttar Pradesh.

Recently, the company won two EPC road project orders worth Rs 41.4 bn from Maharashtra State Road Development Corporation.

As of March 2024, the company's total order book stood at Rs 124 bn, equivalent to 2.4 times the FY24 revenue. Road EPC projects accounted for 38% of the total order book, while 40% originated from HAM road projects, and the rest comprised other projects.

A significant portion, 83%, of these projects are attributed to the government of India, with the remaining 17% coming from the private sector. This distribution provides revenue visibility for the next 2-3 years.

The company expects Rs 80 bn from highway projects in FY25.

To know more, check out the company's detailed factsheet here.

#6 KNR Constructions

KNR Constructions is a key player in the Indian road and highway construction sector, known for its expertise in executing complex EPC and BOT projects.

It makes roads, bridges, flyovers, and undertakes irrigation projects.

The company recently secured a major contract for the construction of a highway in Tamil Nadu.

As of March 2024, KNR's order book stood at Rs 53 bn of which Rs 31.9 bn came from the road sector.

Road (HAM) projects accounted for 42% of the total order book, while 27% originated from road (other) projects, and 31% from irrigation projects.

Given a robust order pipeline and a strategic focus on expanding into new segments and markets, KNR aims to significantly enhance its order book.

Additionally, considering the slow pace of awarding contracts by the NHAI, the company is exploring partnerships for BOT projects and diversification into non-road segments.

The company is net debt-free on a standalone basis and has a strong balance sheet.

To know more, check out KNR Constructions financial factsheet and its latest quarterly results.

#7 Dilip Buildcon Ltd.

Dilip Buildcon is one of India's largest infrastructure construction companies, with a strong focus on road and highway projects.

The company was recently awarded several significant highway construction contracts, including a major project in Maharashtra.

Over the years, the company has developed a reputation for delivering projects on time with high quality standards.

The company expects an order inflow of Rs 100-120 bn in FY25. It is focused on debt reduction and aims to reduce debt by Rs 5 bn in FY25 compared to Rs 8.6 bn reduced in FY24.

The company's main focus would be to strengthen the balance sheet, become net debt-free by FY26, maintain consistent cash flow, deliver growth, and build client reach in different geographies.

To know more about Dilip Buildcon, checkout its factsheet and latest quarterly results.

#8 Ashoka Buildcon

Ashoka Buildcon was incorporated in the year 1993. The company is engaged in the business of construction of infrastructure facilities on engineering procurement and construction basis (EPC) and built operate and transfer (BOT) basis, and sale of ready mix concrete.

It has promoted special purpose vehicles (SPVs) for some of its projects wherein 'Toll Collection Rights' are received in exchange of the construction cost.

The company has four divisions - build operate and transfer (BOT), engineering procurement & construction (EPC), RMC & bitumen, and toll collection.

It has constructed one of India's longest 6-lane flyovers in Kerala of 12.7 Km, India's first 8-lane extra-dosed stayed bridge in 33 months, and constructed Bundelkhand Expressway.

For more details about the company, you can have a look at Ashoka Buildcon factsheet and quarterly results on our website.

#9 Udayshivakumar Infra Ltd.

Udayshivakumar Infra is an emerging player in the Indian road construction sector, gaining recognition for its recent involvement in various road projects.

The company has been actively bidding for contracts under the Bharatmala Pariyojana and has secured several projects that are crucial to India's road network expansion.

It constructs roads including state highways, district roads, smart roads under municipal corporations, smart roads under PM's smart city mission projects, national highways, Bruhat Bengaluru Mahanagara Palike (BBMP), and Local Area Roads in various Taluka Places, etc.

The constant infra projects received from different government departments and agencies have kept its profit metrics intact.

Considering the fact that the Indian government wants to massively scale up road construction in the country, we could expect to see more projects being awarded to Udayshivakumar Infra.

To know more, check out Udayshivakumar Infra's financial factsheet and its latest quarterly results.

#10 Brahmaputra Infrastructure

Brahmaputra Infrastructure is a notable player in the infrastructure construction sector, with a focus on road and highway projects in the northeastern region of India.

The company has been involved in several key projects that are vital to improving connectivity in this region, which has been a priority for the Indian government.

Brahmaputra Infrastructure's growth is supported by its strong order book and expertise in executing projects in challenging terrains.

The company is currently exploring opportunities to expand its operations into other parts of India and diversify into different segments of infrastructure development.

To know more, check out Brahmaputra's financial factsheet.

#11 Akash Infra Projects Ltd.

Akash Infra Projects is a growing infrastructure construction company with a focus on road and highway projects in Gujarat and other states.

The company has successfully executed several key projects, contributing to its reputation as a reliable contractor in the infrastructure sector.

Akash Infra's growth strategy includes expanding its project portfolio by bidding for larger contracts and exploring opportunities in other infrastructure segments.

The company is also investing in technology and equipment to enhance project efficiency and ensure timely delivery of projects.

To know more, check out Akash Infra's financial factsheet.

Snapshot of Roads and Highways Stocks on Equitymaster's Screener

Here's a table showing how the above companies fare on various important metrics -

In Conclusion

India's economy is projected to grow steadily, fuelling demand for efficient road infrastructure. The government has pledged US$ 1.4 trillion for infrastructure development by 2025, with a significant portion earmarked for roads and highways.

In 2024, India is gearing up for a major highway revolution as new expressways are all set to transform how we travel. National highways and expressways now cover around 151,000 kilometres, with plans to expand further. The government also aims to construct 23 new national highways by 2025.

A total of 600+ sites are planned to be awarded by 2024-25 of which 144 Wayside Amenities (WSAs) have already been awarded. In the next five years, the National Highway Authority of India (NHAI) will be able to generate Rs 1 lakh crore (USD 14.30 billion) annually from tolls and other sources.

Overall, the outlook is promising.

However, before you choose any company to ride this revolution, look for consistency in revenue and profit growth.

Look for debt levels and also check the future prospects. A good order pipeline will translate into higher revenues, ultimately indicating good growth prospects.

Happy Investing!

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