India's construction sector is expected to see strong revenue growth of 12-15% in FY2024, driven by government infrastructure spending. ICRA forecasts a stable outlook for the sector with healthy margins.
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New Delhi, Apr 29 (PTI) India's construction sector entities' revenues are likely to grow by 12-15 per cent in the current financial year, while margins will expand by 25-50 bps, rating agency ICRA said on Monday.
It further said that the government's infrastructure push will result in double-digit revenue growth for the construction industry in FY2025.
The rating agency said it maintains a stable outlook on the sector with steady growth in operating income, moderate leverage, and healthy coverage metrics.
"The aggregate order book-to-sales ratio of ICRA's sample set of companies stood at around 3.9x as of December 2023 (compared to 3.4 times during March-2023), thereby indicating a healthy revenue growth prospect over the medium term," ICRA vice president and co-group head - corporate ratings Ashish Modani said.
He said, ICRA expects the revenue growth in FY2025 to remain healthy at 12-15 per cent on a year-on-year basis, albeit slightly lower than the 18-20 per cent revenue expansion assessed for FY2024, owing to high base and some tapering in execution momentum in Q1 FY2025 amid Parliamentary elections.
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