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    Covid’s no hurdle for highway construction

    Synopsis

    Large mutual funds increased exposure to well-placed construction firms such as KNR Constructions, PNC Infratech and Ashoka Buildcon in June.

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    The total national highway construction in the June 2021 quarter is also higher – by 6% – from the June 2019 quarter, latest data from Crisil showed.
    ET Intelligence Group: The pandemic hasn’t been a roadblock to roadbuilding in India. Total national highway construction has improved by a quarter in the three months to June to 2,284 kilometre from the year-ago period.

    Interestingly, total national highway construction in the June 2021 quarter is also higher – by 6% – from the June 2019 quarter, latest data from Crisil showed.

    There are a few reasons why national highway construction has improved. First, just as the pace of awarding of projects from the government improved, the pace of execution has gathered momentum in a similar manner. This was largely because of labour availability.

    Unlike through the first wave of the pandemic, not many labourers returned to their rural homes. Besides, there were region-wise lockdowns in the second wave in comparison with the nationwide lockdown in the first wave. Finally, the government also released funds for construction of projects from “quarterly” basis to “monthly” basis, which addressed liquidity issues for execution.

    Consequently, in June 2021 quarter, national highways of 25 km a day were constructed in comparison with 20 km a day in the June 2020 quarter and 24 km a day in the June 2019 quarter. Large mutual funds increased exposure to well-placed construction firms such as KNR Constructions, PNC Infratech and Ashoka Buildcon in June.




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    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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