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Emerging diversified construction firms likely to witness stable growth in FY26: Crisil

04 Jun 2025 Evaluate

Crisil Ratings in its latest report has said that emerging diversified construction firms are expected to witness stable growth in 2025-26, with revenues projected to rise by 9-11 per cent. It said healthy order books, driven by the timely execution of projects, supporting their credentials, have resulted in the continued scale-up of operations.

However, the report said limited ability to pass on the impact of sharp commodity price fluctuations and stronger competition will limit the operating margins to 10-11 per cent. While the working capital requirements of emerging construction companies will be higher on-year, it will be funded mainly by better cash flows and risk management practices, thus limiting fund-based working capital bank borrowings. 

Crisil Ratings Senior Director Rahul Guha has said that the government's thrust on infrastructure and better access to funding continue to support the growth of emerging corporates in the diversified construction industry. He said diversity in the order book should enable these players to log another year of steady revenue growth. However, he said that profitability will remain flat on-year as competition within the segment intensifies and subcontracting charges remain in check.  


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