Now Reading: India Ratings keeps neutral outlook for FY27 transport infra
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India Ratings keeps neutral outlook for FY27 transport infra
India Ratings and Research (Ind-Ra) has maintained a neutral outlook for the transportation infrastructure sector for the remainder of FY27, citing stable operating assets and healthy toll revenue growth. The agency retained stable outlooks for toll roads, hybrid annuity model (HAM) projects, airports and electric bus projects.
Toll collections at national highway plazas are expected to grow 7-7.5% in FY27, supported by 4-4.5% traffic growth. Aggregate toll income in Ind-Ra's portfolio grew 10.3% year-on-year in FY26 and 8% in the first quarter of FY27. However, construction risks remain elevated, with more than half of 199 ongoing NHAI projects involving award costs of nearly Rs 90,000 crore likely to face delays exceeding 12 months.
For airports, Ind-Ra revised the rating outlook to stable while noting domestic passenger traffic grew 1.6% in Q1 FY27 but international traffic fell 10% due to airspace closures. NHAI plans to award about 51% of its planned 5,140 km under HAM, while BOT awards remained subdued with no awards in FY26.
Indian Opinion Analysis
The neutral outlook masks a sharp divergence: toll roads are buoyed by WPI-linked tariff hikes and traffic growth, while highway construction faces chronic delays. NHAI's 51% target for HAM awards reflects its preference over the BOT model, which remains stalled despite recent contract amendments. The real test is whether the Rs 90,000 crore in delayed projects will trigger cost overruns or settle through extensions. Watch for Q2 FY27 toll collection data to confirm if traffic growth holds amid global volatility.
Source: livemint.com
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