KNR Constructions Targets Growth via Railways as NHAI Lines Up ₹1.8 Lakh Crore Highway Pipeline

BY ADMIN • FILED 20 Aug 2026, 3:29 PM

KNR Constructions Limited is looking to strengthen its growth prospects through a combination of road projects and diversification into railways and urban mobility, even as highway project awards remain subdued in the early part of FY27. The company’s management remains optimistic that infrastructure spending will gain momentum, supported by a substantial pipeline of projects planned by the National Highways Authority of India (NHAI).

NHAI Lines Up ₹1.8 Lakh Crore Highway Pipeline

According to KNR Constructions’ Q1 FY27 earnings call, highway awarding activity remained muted during the first quarter of FY27. NHAI awarded approximately 107 km of projects during the quarter, while execution moderated to around 638 km.

However, the company believes the near-term slowdown does not indicate a weakening of India’s infrastructure opportunity. NHAI has outlined a revised FY27 plan to award 54 highway and expressway projects covering approximately 2,444 km, with a combined estimated value of around ₹1.8 lakh crore across 13 states.

KNR Constructions sees this pipeline as an important opportunity for order inflows during the coming quarters. The company is targeting ₹8,000 crore–₹10,000 crore of new orders in FY27, with a focus on NHAI projects, irrigation and other state government infrastructure opportunities.

Railways Emerging as a Key Growth Avenue

While roads remain an important part of KNR Constructions’ business, the company is increasingly looking at railway infrastructure as a major medium-term diversification opportunity.

The management highlighted the government’s strong focus on railway capacity expansion and modernization. Railway capital expenditure for FY27 has been allocated at around ₹2.93 lakh crore, supporting projects related to capacity augmentation, multi-tracking, freight corridors, safety, station redevelopment and connectivity.

KNR believes this spending could create a sizeable pipeline for railway civil construction, track infrastructure and associated projects.

The company is particularly positive about opportunities in southern India, with Andhra Pradesh receiving a record ₹10,134 crore railway allocation for FY27. The operationalisation of the South Coast Railway zone could further support infrastructure development in the region.

KNR plans to selectively participate in railway projects where it sees adequate execution visibility, attractive returns and a strong fit with its existing capabilities.

Urban Mobility and Metro Projects Also on Radar

Beyond conventional railway projects, KNR Constructions is evaluating opportunities in metro and urban mobility infrastructure.

The company sees potential in elevated corridors, viaducts, stations, bridges and related civil works as metro networks expand across Indian cities.

KNR has already explored the elevated metro segment and has formed a JV with NCC to pursue such opportunities. Management indicated that discussions and bidding activity are continuing, particularly for projects in southern India where the company believes it has better execution familiarity.

The company has also previously participated in an elevated metro bid in Bhubaneswar, although the project was not pursued at an uneconomical price.

Diversification Beyond Roads

KNR’s strategy is gradually moving beyond its traditional road-focused profile. Management highlighted opportunities across expressways, railways, urban mobility, mining, irrigation, logistics and battery energy storage systems.

However, the company remains cautious about entering new segments merely for the sake of order-book growth. Management emphasised that project selection will remain focused on execution visibility, appropriate returns and compatibility with KNR’s capabilities.

The approach is particularly relevant as the company’s order book has expanded substantially following the addition of mining projects.

Order Book Gets a Major Boost

As of June 30, 2026, KNR Constructions reported an order book of approximately ₹8,667 crore, excluding two recently won HAM projects and the new mining project.

Including these projects, the total order book stood at approximately ₹15,234 crore.

The order book composition was:

45% – Mining
38% – Roads
11% – Irrigation
6% – Pipeline

The company expects the non-mining order book to be executable over approximately 3–3.5 years, while the mining projects have substantially longer execution periods.

This gives KNR visibility while simultaneously increasing the importance of its diversification strategy.

FY27 Execution Expected to Improve

KNR Constructions expects execution to accelerate as new projects begin contributing.

Management is targeting FY27 revenue of around ₹2,200–₹2,300 crore, compared with approximately ₹2,000 crore in the previous year. EBITDA margin is expected to be around 8–9% for FY27, with stronger margins anticipated as HAM and mining projects ramp up.

For FY28, management expects a significant improvement, targeting more than ₹3,000 crore of revenue and an EBITDA margin of approximately 11–12%.

The improvement is expected to come from greater execution across the company’s recently secured projects.

Railways Could Become an Important Medium-Term Growth Driver

For KNR Constructions, the combination of a large NHAI pipeline and increasing opportunities in railway and urban mobility infrastructure provides multiple avenues for growth.

The ₹1.8 lakh crore NHAI pipeline could support road order inflows as awarding activity improves, while the government’s ₹2.93 lakh crore railway capex allocation creates an additional opportunity for KNR to diversify its order book.

The company’s strategy appears to be focused on maintaining its core road capabilities while selectively expanding into railway, metro and other infrastructure segments.

With management targeting ₹8,000–₹10,000 crore of fresh orders in FY27, the coming quarters will be important in determining how quickly the company’s large project pipeline translates into actual awards and execution.

Key Takeaway

KNR Constructions is positioning itself for the next phase of infrastructure growth by combining its traditional road expertise with opportunities in railways and urban mobility. While near-term NHAI awarding activity remains subdued, the planned ₹1.8 lakh crore highway pipeline provides significant visibility. At the same time, rising railway capex and opportunities in metro infrastructure could help KNR build a more diversified order book over the medium term.

Disclaimer: This article is based on information and management commentary contained in KNR Constructions Limited’s Q1 FY27 earnings call transcript. It is intended for informational and educational purposes only and should not be considered investment advice, a recommendation to buy or sell securities, or a guarantee of future performance. Investors should conduct their own research and consult a qualified financial adviser before making investment decisions.