Amid factors like slower awarding of projects and delayed receipt of 'appointed date' from the National Highways Authority of India (NHAI), credit rating agency CRISIL in its latest report has said that revenue growth of road developers in the engineering, procurement, and construction (EPC) segment is likely to halve in the ongoing fiscal and the next fiscal.
As per the report, revenue growth may halve in fiscals 2020 and 2021 to 15 per cent, compared with 30 per cent in fiscal 2019. It noted that the NHAI awarded a whopping 7,400 km in fiscal 2018, which slowed down the following year to about 2,200 km, further adding that awarding is expected to be 4,000 km a year during the current fiscal and the next fiscal.
Besides, CRISIL said that the delay in declaring appointed dates for the projects awarded is primarily due to issues in land acquisition. However, the rating agency underlined that the slowdown is unlikely to impact the credit profiles of the EPC players.