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Govt to keep focus on infra project segments for tendering in FY23: Ind-Ra

The orders floated were majorly from Bharatmala Expressway projects and Swachh Bharat Mission schemes.

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Hyderabad: The number of overall tenders floated (with a value above Rs 2.5 billion) across all divisions in the construction space grew 11% YoY in FY22 to Rs 8,901 billion, signifying the impetus shown by the central and state governments in increasing the order inflow on the COVID-19 pandemic hit season, India Ratings and Research (Ind-Ra) said on Wednesday.
The overall tender inflows in FY22 grew 11% yoy to Rs 8,901 billion, after growing 38% YoY in FY21.

Out of the overall tenders floated, roads, irrigation, and other real estate segments (including hospitals and hotels) on a combined basis contributed around 78% to the overall tenders floated.

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Other than these segments, there were incremental tender inflows from railways, power, and other industrial (including gas & oil, basic chemicals, and telecom) segments, although they contributed only 18% to the overall tenders floated.

In FY22, the tenders floated grew incrementally, majorly contributed by both Uttar Pradesh and Maharashtra at Rs 888 billion and Rs 872 billion, respectively. The tenders announced from both the states contributed 20% to the overall tenders (10% each) floated across the country in FY22.

The orders floated were majorly from Bharatmala Expressway projects and Swachh Bharat Mission schemes. Rajasthan and Madhya Pradesh followed next with a share of 7% and 6%, respectively.

Out of the overall order awards in FY22, 40% of the orders were contributed by roadways (FY21: 27%), 17% by railways (21%), and 12% by water (including irrigation; 10%). While the mining segment had seen huge growth of 1115% yoy in FY21 in the order awards, it decreased by 58% yoy in FY22.

The overall orders awarded grew 10% yoy in FY22, majorly on account of the revival of the EPC sector post-pandemic. Ind-Ra, based on the incremental budgetary allocations announced by the central government in February 2022, believes the thrust on the EPC sector would continue in FY23 as well, the rating agency said.

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