• ICRA expects road execution of MoRTH to moderate to 9,000 - 9,500 km (~25-26 km/day) in FY2026e, which is marginally lower than ICRA’s earlier estimate of 9,500 – 10,000 km. The same is on account of expectations of lower execution in the current year, owing to the extended monsoons in H1 FY2026 and lower awarding by the Road Ministry in the past two years (FY2024 and FY2025E). The road execution for FY2025 declined by 14% to 10,660 km compared to 12,349 km in FY2024.
• The MoRTH awarding during FY2025 is estimated to be 8,000-8,500 km, which is flattish on a YoY basis, but significantly lower than the road awards during FY2021-FY2023. ICRA foresees the road awards in the range of 9,000-9,500 km in FY2026, supported by expected improvement in project awarding in H2 FY2026. The awarding activity is expected to pick up owing to the recent Ministry’s directive to award projects only after 90% right-of-way availability, receipt of forest clearances and GAD approvals for road-over-bridge (ROB).

Exhibit 1: Budgetary allocations over the last 10 years

Source: ICRA Research; Union Budget documents; IEBR: Internal and Extra Budgetary Resources; PA: Provisional actuals; BE: Budget estimates; MORTH – Ministry of Road Transport and Highways