Infra stock jumps 3% after receiving ₹1,087 Cr road infrastructure project in Africa

SYNOPSIS: Afcons Infrastructure secured a Rs. 1,087 crore Uganda road project, received a favourable arbitration award, and flagged a Gabon bond dispute, while maintaining that liquidity, operations and order book remain unaffected.

During Sunday’s trading session, shares of the flagship infrastructure engineering and construction company of the Shapoorji Pallonji Group surged nearly 3 percent on BSE, after the company announced securing an infrastructure project valued at over €100 million (or around Rs. 1,087 crores).

With a market cap of Rs. 12,484 crores, shares of Afcons Infrastructure Limited were trading in the green at Rs. 339.45 on BSE, up by over 2 percent, compared to its previous closing price of Rs. 331.6. The stock has delivered negative returns of around 23 percent in the last six months, and has fallen by over 13 percent in the last one month.

Major Uganda Road Project & Arbitration Award

As per its latest regulatory filing, Afcons Infrastructure Limited has secured a strategic road infrastructure project in Uganda, Africa, valued at over €100 million or around Rs. 1,087 crores. The Road project is funded by a multilateral development agency.

In a separate development, the company received an arbitration award on 29 January 2026 in its favour in a dispute with IRCON International Limited. The award includes a cash payout of Rs. 27.03 crore along with the return of a bank guarantee worth Rs. 27.54 crore, related to the construction of a tunnel under the USBRL project. Afcons stated that this award will have a positive impact on its financial position.

Gabon Project Dispute Under Arbitration

Additionally, Afcons disclosed it has received communications from Lombard Insurance Company Limited regarding the invocation of bonds by  SOCIÉTÉ AUTOROUTIERE DU GABON (SAG), amounting to around €17.85 million, related to an EPC contract with SAG on 10th September 2020, for a road project in Gabon, for which Lombard had provided surety on the company’s behalf.

SAG, an investment arm of Meridiam (France), has been granted a 30-year public-private partnership concession by the Republic of Gabon for the rehabilitation, construction, financing, and operation of the Transgabonaise national road. Under this concession, Afcons was awarded an EPC contract by SAG, valued at ~€113.03 million, for the design, construction and upgradation of National Road NR1, covering about 117 km.

The company emphasised that around 93.47 percent of the project was completed and opened to traffic as of 31st December 2025. However, disputes have arisen between Afcons and SAG regarding the certification of certain balance works and the release of corresponding payments. In line with contractual dispute resolution mechanisms, Afcons has initiated arbitration proceedings under the rules of the International Chamber of Commerce (ICC) to address delays and additional costs incurred during execution. The matter is currently under arbitration.

Afcons stated that it believes the invocation of the bonds is inconsistent with the contractual terms, and the company continues to pursue all available contractual and legal remedies. Importantly, management clarified that the dispute is project-specific and does not affect the company’s overall order book, execution capability, or long-term business outlook.

The company further highlighted that the bond invocation is not expected to have any material adverse impact on its liquidity position, ongoing operations, or execution of other projects.

Financials & More

Afcons Infra reported a marginal growth in its revenue from operations, showing a year-on-year increase of around 1 percent from Rs. 2,960 crores in Q2 FY25 to Rs. 2,988 crores in Q2 FY26. In contrast, its net profit decreased during the same period from Rs. 135 crores to Rs. 105 crores, representing a decline of nearly 22 percent YoY.

As of September 2025, the company reported an order book of Rs. 32,681 crores, with an order inflow of around Rs. 1,268 crores in H1 FY26. Urban infrastructure projects, including underground and elevated metro works, form the largest share at about 32 percent. This is followed by hydro and underground projects, which account for roughly 25 percent. Urban infrastructure projects related to bridges and elevated corridors contribute around 22 percent, while marine and industrial projects make up about 13 percent. Surface transport projects account for nearly 6 percent of the order book, and the remaining 2 percent comes from the oil and gas segment.

Afcons Infrastructure Limited is engaged in the business of marine works, highways, bridges, metro works, power houses, tunnels, oil and gas, LNG tanks and other general civil engineering projects both in India and Africa and Mideast countries.

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