Highway Infrastructure has received a work order valued at ₹80.17 crore from the National Highways Authority of India (NHAI). The contract pertains to user fee collection at the Palayam Fee Plaza located at Km 154+500 of NH-44. The scope covers the Krishnagiri to Thumbipadi section on a Build-Operate-Transfer (BOT) basis in Tamil Nadu.

As per the regulatory filing dated August 21, 2026, the engagement is for a period of 90 days. The contract terms include the upkeep and maintenance of adjacent toilet blocks, including the recouping of consumable items.

Order in financial context

The ₹80.17 crore order represents approximately 39% of the company's average quarterly revenue of ₹206.30 crore. The total disclosed order book currently stands at ₹275.10 crore, summing six orders disclosed across the last three fiscal quarters. This backlog provides coverage for approximately 1.33 quarters of average quarterly revenue.

Company order track record

Order inflow velocity accelerated significantly in Q2FY27 compared to the preceding two quarters, which had no disclosed orders. The current quarter saw six distinct awards from NHAI, totalling ₹275.10 crore. The value of the latest order matches previous large awards in the quarter, while smaller orders hovered around ₹28.69 crore.

Execution and revenue quality

Consolidated revenue has shown volatility over the last three quarters, rising sharply to ₹277.20 crore in Q4FY26 after lower runs in Q3 and Q2. Operating profit margins recovered from a negative position in Q2FY26 (-7.41%) to positive territory in subsequent quarters, reaching 4.92% in Q4FY26. Net profit followed a similar trajectory, turning positive from a loss in Q2FY26.

Revenue growth

As Highway Infrastructure sustained order wins, particularly in the recent quarter, its annual revenue grew from ₹504.50 crore in FY25 to ₹608.00 crore in FY26, representing a YoY growth of +20.5% based on the latest annual data. This growth aligns with the company's ability to execute on its existing portfolio.

Working capital and execution capacity

The company maintains a healthy liquidity position with a current ratio of 2.09x and a total liabilities/equity ratio of 0.65x, indicating low leverage and sufficient short-term assets to cover liabilities. However, operating cashflow was negative at -₹4.90 crore in FY25, while free cashflow stood at -₹6.60 crore. This disconnect between accounting profits and cash generation suggests that receivables or working capital cycles may be stretched.

Key observations

• Margin stress: Operating profit turned negative in Q2FY26; execution stress was visible in quarterly data, though margins recovered in subsequent quarters.
• Cash conversion: Operating cashflow of -₹4.90 crore in FY25 indicates the backlog is not converting to cash efficiently; receivables or working capital cycles may be stretched.
• Client concentration: 100% of the disclosed order book comes from NHAI; single-client dependency remains a structural risk factor.

Highway Infrastructure posted a 170.6% year-on-year revenue surge to ₹304.3 crore for the quarter ended June 30, 2026. However, profitability contracted as EBITDA fell to ₹4.8 crore and net profit dropped to ₹1.1 crore, weighed down by temporary tolling disruptions.

The company attributed the margin pressure to lower traffic volumes at the Moti Naroli toll project due to geopolitical developments and global trade disruptions. Management noted that these factors were temporary and localized to the first quarter, with traffic trends showing signs of recovery in July 2026.

Financial Performance

Revenue growth was driven by steady execution across its diversified verticals, including engineering, procurement, and construction (EPC), tollway collection, and real estate. The consolidated order book stood at approximately ₹778 crore as of June 30, 2026, providing visibility for future execution.

Order Book and Pipeline

Management highlighted a healthy bidding pipeline and recent wins in the toll segment. In July 2026, the company secured a new tollway collection contract valued at approximately ₹28.7 crore for the Kozhinjipatti toll plaza in Tamil Nadu. It also received a letter of acceptance for operations at a fee plaza on NH-44 with a contract value of approximately ₹80 crore.

Saurabh Mittal, Joint Chief Financial Officer, stated that including recent wins, the total work order stands at ₹900 crore, with EPC comprising nearly ₹500 crore. The company targets a turnover of ₹850 crore for FY27, with ₹700 crore expected from the toll segment.

What the Numbers Show

The divergence between the 170.6% revenue growth and the sharp contraction in profitability highlights the sensitivity of the tolling business to external shocks. While top-line expansion suggests robust order conversion or higher throughput in other segments, the low EBITDA of ₹4.8 crore indicates that the toll segment’s contribution to margins was severely impacted by the temporary traffic drop. This structural vulnerability underscores management’s stated strategy to diversify geographically into states like Tamil Nadu and Andhra Pradesh to hedge against regional risks.

Strategic Outlook

Riddharth Jain, Director and Chief Executive Officer, emphasized a shift toward technology integration to improve efficiency and reduce manpower costs. The company is focusing on leveraging data analytics and AI to manage pan-India projects from a central location.

In the EPC segment, the Beverly Hills project, valued at approximately ₹70 crore, commenced execution this quarter. Management expects this project to contribute around 40-45% of EPC revenue over the next 15 to 16 months. The company aims to increase its pre-qualification (PQ) to bid for larger tenders independently or through joint ventures.