Indian Road Transport & Highway Stock Updates

These road infrastructure stocks are on the fast lane to scale new highs; here’s why

As the Ministry of Road Transport and Highways reshapes India’s road development, keep an eye on IRB Infra, Ashoka Buildcon, KNR Constructions, and PNC Infratech.
Get ready for the sound of progress in India as the government gears up for a major boost in road infrastructure. In the 2024 budget, there may be a whopping 25% increase in funds allocated for road development, signalling a potential windfall for companies in the infrastructure sector. But before investors rev up their engines, it’s crucial to understand that not all players will enjoy smooth rides.

A significant shift in project allocation is on the horizon, changing the dynamics between the National Highways Authority of India (NHAI) and the Ministry of Road Transport and Highways (MORTH). Unlike the previous 50-50 split, MORTH is set to take charge of a staggering 90% of projects, leaving NHAI with a mere 10% in 2024. This game-changing move has far-reaching implications for companies in the road infrastructure sector.

For those accustomed to working closely with NHAI, the road ahead may be less promising, with order books potentially thinning and engines sputtering. On the flip side, companies with strong ties to MORTH are poised for success, as the ministry becomes the primary driver of projects.

Enter the players with MORTH’s mighty grip
IRB Infra: IRB Infrastructure Developers Ltd is an infrastructure development and construction company in India with extensive experience in the roads and highways sector. It is also in other business segments in the infrastructure sector, including maintenance of roads, construction, airport development and real estate.
Ashoka Buildcon: Ashoka Buildcon Ltd is engaged in the business of construction and infrastructure facilities on an EPC and BOT basis. It is also involved in the sale of RMC (ready-mix concrete).

KNR Construction: KNR Constructions Ltd, incorporated in 1995, is engaged primarily in the construction of roads, bridges, flyovers and irrigation projects.
PNC Infratech: PNC Infratech Limited is one of the front-end infrastructure development, construction, and management companies in the country. The company undertakes infrastructure projects, including highways, bridges, flyovers, power transmission lines and towers, airport runways, industrial area development, and other infrastructure activities.

While the race is still on, smaller players armed with specialized skills and competitive bids can carve out their niche. However, the winds of change are undeniably blowing in favour of MORTH-linked companies. As the road infrastructure sector gears up for a boom in 2024, investors should keep a close eye on these companies, potentially witnessing them lead the charge in this new terrain.

In essence, investors, fasten your seatbelts the road ahead for Indian infrastructure stocks is set to be filled with twists and turns, with MORTH firmly in the driver’s seat. Keep a keen eye on these MORTH favoured companies they might just be the stars of the upcoming boom.

Disclaimer: This post has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. The information is based on various secondary sources on the internet and is subject to change. Please consult with a financial expert before making investment decisions.