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Order inflow for our infra universe slowed sharply in Q2FY27, with BSE-announced inflow of INR 221bn (vs. INR 747bn in Q2FY26 and INR 572bn in Q1FY27). Road, building and rail awards stayed thin, while T&D (KEC, Kalpataru) and diversified players (Afcons, NCC, Dilip Buildcon, Jkumar) made up ~70% of the quarter's inflow. For most players, H1FY27 inflow is tracking well below FY27 guidance, which implies a steep H2 rampup. Our coverage universe, we expect revenue/EBITDA/PAT growth of ~6%/1%/-0.5% YoY, though EBITDA margin is likely to compress ~40bps YoY to 7.6%. Stock wise, PSP NCC and RVNL are likely to deliver relatively better revenue growth. KNR, HG Infra and IRCON are expected to see weak YoY revenue, and Ahluwalia could see better QoQ margin. Top picks: NCC & PSP

Industry order inflow slows:

Order inflow weakened in Q2FY27, with the industry reporting (Exhibit 2) inflow of INR 221bn (vs. INR 747bn YoY and INR 572bn QoQ). Road EPC inflow was just INR 31bn (vs. INR 111bn YoY), with only Ceigall (INR 18bn) and Ashoka Buildcon (INR 7bn) securing meaningful orders. GR Infra, PNC, KNR and HG Infra reported negligible wins. Building EPC inflow was INR 12bn, entirely from Capacite. Ahluwalia had no announced orders, and PSP does not disclose orders on BSE. Diversified players reported INR 83bn, led by Afcons (INR 28bn), NCC (INR 31bn), Dilip Buildcon (INR 20bn) and JKumar (INR 10bn). T&D contractors sustained momentum with INR 71bn, led by KEC and Kalpataru. In railways, RVNL secured INR 18bn, while RITES (INR 5bn) and IRCON (~INR 2bn) remained subdued. Overall, this was a slow quarter for road, building and rail EPC, cushioned by T&D and diversified players..

H1 inflow trails guidance; order book offers cushion:

The Q1FY27 order book provides healthy revenue visibility of 2.6–6.0x TTM revenue, which cushions the slow H1 inflow. NCC's large order book (INR713bn; 4.0x) offers robust multi-year visibility. Ahluwalia (INR207bn; 4.6x) and PSP (INR133bn; 4.0x) are well placed among building players. In railways, RVNL (INR935bn; 4.4x) and RITES (4.0x) provide strong visibility, while IRCON (2.7x) is moderate. H1FY27 inflow for most players is tracking well below FY27 guidance, so H2 order wins will be key.

Financial performance – Earnings recovery underway:

Q2FY27 revenue across the infra universe is expected to grow ~6.1% YoY and EBITDA +0.7% (margin 7.6%, -41bps), with PAT -0.5%. PSP (+25% revenue, +37% PAT), Dilip Buildcon (+10% revenue, +52% PAT on a higher base-quarter tax rate), NCC (+10% revenue, +55bps margin), PNC (+10% revenue, margin -136bps) and RVNL (+10% revenue, +12% PAT), Ashoka (-1% revenue) and RITES (+10% revenue, margin -162bps). KNR (-5% revenue) and HG Infra (-30% revenue, -76% PAT) by slow execution, while IRCON (+2% revenue) is flat. Ahluwalia (EBITDA -24.5%, margin -342bps) is hurt by cost volatility but expect this to be better QoQ at 8%.

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