Chennai: The overall tenders announced in the construction space rose 31 per cent to Rs 4.5 lakh crore in Q2FY25, though tender awarding activity is yet to pick up pace.
Tenders valued above Rs 250 crore across all divisions in the construction space increased 31 per cent to Rs 4.546 lakh crore against Rs 3.479 lakh crore in 2QFY24.
With the improvement in tender announcement in Q2 FY25, the tendering activity is expected to increase in 3QFY25. It had slowed down in 1QFY25 due to the general elections. Of the tenders floated, 38 per cent are for roads, up from 32 per cent in the same quarter last year. Further, 11 per cent are for railways, 19 per cent for irrigation and sewage, 10 per cent for power and 21 per cent are for buildings, according to India Ratings.
However, the number of orders awarded were still lower in Q2 FY25 by 31 per cent at Rs 1.547 lakh crore against Rs 2.238 lakh crore in the same quarter last year. Roads and power segments contributed to the major chunk of the orders awarded with 22 per cent and 38 per cent share, respectively. Buildings accounted for 17 per cent of projects awarded.
“The tendering activity has renewed during 2QFY25 and subsequently, the awarding activity is likely to gather pace over 2HFY25. However, the key focus remains on the competitive intensity, given the backdrop of low quantum of the order book with EPC contractors,” said Vijay Babu, Associate Director, Corporate Ratings, Ind-Ra.
