Small road firms to face EPC hurdle as hybrid-annuity model takes back seat

Under this model, the government provides 40 per cent of the project cost to the developer to start work, while the remaining investment is made by the developer

With road construction under the hybrid-annuity model expected to take a back seat next year, mid-sized companies such as Gawar Construction, Dilip Buildcon and Ashoka Buildcon, may lose the top positions in the sector. 

These companies emerged winners, as the focus shifted to hybrid-annuity — in which a majority of the financial risk is borne by the Union government. 

“Hybrid-annuity would be dormant in the next fiscal as the sector’s ability to absorb more of it is restrained,” Ankur Agarwal, senior analyst, India Ratings and Research, said. 

Engineering-procurement-construction (EPC) projects, which were dominant in 2018-19, will continue to have a