KNR Constructions Ltd has added another milestone to its infrastructure portfolio with the award of a new highway development project valued at Rs 4.59 billion. The announcement, made in late September 2025, reinforces the company’s position as a leading player in India’s road construction sector and adds significant weight to its already robust order book.
The project, awarded by a state-level road development authority, involves the four-laning of a key national highway stretch under the Hybrid Annuity Model (HAM). The scope includes civil works, toll infrastructure, and environmental safeguards, with execution expected to begin in Q4 FY25.
Key Highlights From The Project Award
- KNR Constructions wins Rs 4.59 billion highway project under HAM
- Scope includes four-laning of a national highway corridor with tolling infrastructure
- Execution timeline set at 24 months with a 15-year maintenance obligation
- Adds to KNR’s order book, which stood at Rs 85.6 billion as of August 2025
- Project aligns with government’s Bharatmala and Gati Shakti infrastructure programs
Project Scope And Execution Timeline
The newly awarded project spans approximately 48 kilometers and is located in a high-traffic corridor connecting industrial zones and logistics hubs. The contract includes:
- Road widening and strengthening to four lanes
- Construction of bridges, culverts, and underpasses
- Installation of toll plazas and ITS systems
- Environmental mitigation measures including tree plantation and noise barriers
KNR Constructions will be responsible for both the construction phase and post-completion maintenance for 15 years, as per HAM norms. The company is expected to deploy its in-house equipment and engineering teams, ensuring cost efficiency and execution control.
Financial Structure And Revenue Recognition
Under the Hybrid Annuity Model, 40 percent of the project cost will be paid during the construction phase, while the remaining 60 percent will be recovered through semi-annual annuity payments over the maintenance period. This structure ensures predictable cash flows and reduces exposure to traffic risk.
Revenue recognition will follow the percentage-of-completion method, with initial billing expected to commence in Q1 FY26. The project is expected to contribute meaningfully to KNR’s top line over the next two fiscal years.
Operational Strength And Order Book Position
KNR Constructions has consistently demonstrated execution excellence across highway, irrigation, and urban infrastructure projects. The company’s current order book includes:
- Road projects worth Rs 72.4 billion
- Irrigation and water management contracts worth Rs 9.6 billion
- Urban infrastructure and EPC works totaling Rs 3.6 billion
The Rs 4.59 billion award adds to this pipeline and strengthens KNR’s visibility for FY26 and FY27. The company maintains a debt-light balance sheet and has a track record of early project completion, which enhances its competitiveness in bidding for new contracts.
Market Reaction And Investor Sentiment
Following the announcement, KNR Constructions shares rose 1.8 percent intraday, reflecting investor confidence in the company’s ability to execute and monetize large-scale infrastructure projects. The stock has gained over 12 percent in the past three months, supported by strong quarterly earnings and steady order inflows.
Key investor themes include:
- Execution efficiency and margin stability
- Asset-light model with minimal exposure to BOT risks
- Strong relationships with central and state agencies
- Focus on high-growth geographies and strategic corridors
Infrastructure Outlook
The project award comes amid a broader push by the Indian government to accelerate infrastructure development under the Gati Shakti master plan and Bharatmala Phase II. With increased budgetary allocations and policy support, road construction is expected to remain a key growth driver for EPC companies.
KNR Constructions is well-positioned to benefit from this momentum, given its execution capabilities, financial discipline, and sectoral focus.
Sources: Economic Times Infra Desk, BSE Corporate Filings, KNR Constructions Investor Presentation Q2 FY25.
