Order book position of road EPC companies to improve further: CRISIL
ROADS & HIGHWAYS

Order book position of road EPC companies to improve further: CRISIL

Credit Rating Information Services of India Ltd (CRISIL) has informed the media that engineering, procurement and construction (EPC) companies are further expected to improve their order book position, from over three times the revenue at present, supported by new project awarding momentum.

As per CRISIL, asset monetisation in the roads sector will accelerate with the expected growth of EPC companies in the same field, helped by different government initiatives.

Earlier, Associate Director of CRISIL, Priyanka Patawarisay had told the media that with the low impact on business performance and their healthy capital structure, the credits of the sample set of road EPC firms are expected to remain steady.

A continued prudent working capital management could increase the total outside liabilities to the total tangible net worth ratio by about 1.5 times in FY21, said Patawarisay.

Patawarisay had said that, due to lower operating profits, the interest coverage ratio is expected to reduce to 3 times from 3.5 times in FY20.

Revenues for large road EPC companies are expected to recover and grow by 15-20% in FY22, thanks to strong order books.

The credit profiles would also be stable if they maintained their profitability. While operations at most project sites have stabilised, the ability of road EPC firms to maintain growth momentum and manage liquidity in the face of the ongoing pandemic will be a key metric to watch.

Image Source

Credit Rating Information Services of India Ltd (CRISIL) has informed the media that engineering, procurement and construction (EPC) companies are further expected to improve their order book position, from over three times the revenue at present, supported by new project awarding momentum. As per CRISIL, asset monetisation in the roads sector will accelerate with the expected growth of EPC companies in the same field, helped by different government initiatives. Earlier, Associate Director of CRISIL, Priyanka Patawarisay had told the media that with the low impact on business performance and their healthy capital structure, the credits of the sample set of road EPC firms are expected to remain steady. A continued prudent working capital management could increase the total outside liabilities to the total tangible net worth ratio by about 1.5 times in FY21, said Patawarisay. Patawarisay had said that, due to lower operating profits, the interest coverage ratio is expected to reduce to 3 times from 3.5 times in FY20. Revenues for large road EPC companies are expected to recover and grow by 15-20% in FY22, thanks to strong order books. The credit profiles would also be stable if they maintained their profitability. While operations at most project sites have stabilised, the ability of road EPC firms to maintain growth momentum and manage liquidity in the face of the ongoing pandemic will be a key metric to watch. Image Source

Next Story
Products

Viva ACP Launches FR A1-Rated Honeycomb Panels for Fire Safety

Viva, Asia’s largest manufacturer and supplier of aluminium composite panels (ACP) introduced its FR A1-rated Honeycomb Panels, setting a new industry benchmark for fire safety and architectural excellence. Engineered to deliver exceptional performance, these panels combine advanced fire-resistance technology with aesthetic versatility, offering a revolutionary solution for safety-critical environments.The FR A1 rating represents the highest standard of fire resistance under the European Standard EN 13501-1, signifying non-combustibility and zero contribution to fire, smoke, or toxic emissio..

Next Story
Real Estate

Almal Real Estate Expands into Commercial, Global Markets

Almal Real Estate Development is soon to announce its upcoming expansion into new verticals and international markets as part of its strategic growth plans for 2030. The company, known for its innovative luxury residential and hospitality developments, is preparing to diversify into the commercial sector with the introduction of The Smart Space, a network of business centers in UAE featuring five-star amenities. Additionally, Almal is entering new markets in Bali and Thailand as a community developer, focusing on villa and townhouse projects.The expansion into the commercial real estate sector..

Next Story
Infrastructure Urban

NABARD Approves Rs 9.03 Billion for 127 Projects in Himachal

The Himachal Pradesh government has secured approval from the National Bank for Agriculture and Rural Development (NABARD) for 127 projects worth Rs 9.03 billion for the 2024-25 fiscal, Chief Minister Sukhvinder Singh Sukhu announced. During a meeting with MLAs from Kangra, Kullu, Kinnaur, Solan, Chamba, Bilaspur, and Lahaul-Spiti districts to discuss priorities for the 2025-26 budget, Sukhu said the approved projects include 50 MLA-priority schemes under the Public Works Department, valued at Rs 4.12 billion, and 23 MLA-priority schemes under the Jal Shakti Vibhag, costing Rs 1.79 billio..

Advertisement

Advertisement

Subscribe to Our Newsletter

Get daily newsletters around different themes from Construction world.

STAY CONNECTED

Advertisement

Advertisement

Advertisement

Advertisement

Talk to us?