Infrastructure: Order inflow pulse, P Lilladher

Prabhudas Lilladher has come out with its report on infrastructure space. According to the research firm railways and ports are the two sectors where major orders can be expected in the future.

Synopsis: Ordering activity was mainly seen in the Water and Building segments. The total order inflow announced by various E&C players on BSE amounted to Rs53.1bn, down by 26.8% on MoM basis. L&T announced the higher chunk of projects worth Rs33.5bn followed by IVRCL at Rs6.5bn.

Sectoral Insights: Roads sector was quite inactive this month. The only big order was bagged by HCC which came from Gujarat for a six-laning of a 6km road, including a bridge over the Narmada river worth Rs8bn. Total order inflow was Rs9.5bn, down from Rs63.7bn in April 2012. Buildings projects totalling to Rs28.6bn were awarded during the month, up from Rs8.1bn in April 2012. Main recipient was L&T and C&C constructions. A mix of residential, commercial and social infrastructure constituted the inflows. Water and Irrigation projects worth Rs8.1bn were awarded mainly from Andhra Pradesh followed by Gujarat. Amongst the others were transmission orders to L&T and construction of metro axillaries totalling to Rs6.9bn.

Comment: We expect the ordering activity to gather momentum in the coming months as the Government has shown a keen interest to fast track the projects. Railways and Ports are the two sectors where major orders can be expected in the future. However, in the coming months, Roads will continue to dominate the scene. 

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