Investors are piling into shares of Indian road builders, betting that Saturday’s Union Budget will contain measures to spur investment in infrastructure.
A custom Bloomberg index of nine road builders is up 8.1 per cent this month, versus the 0.7 per cent drop in the main S&P BSE Sensex index. The gauge includes IRB Infrastructure Developers Ltd, Sadbhav Engineering Ltd and KNR Constructions Ltd, some of which struggled in 2019 as national elections caused the government to defer spending.
The rally is being led by belief that Finance Minister Nirmala Sitharaman will need to do more to revive economic growth from the lowest since 2008. She outlined $1.5 trillion in infrastructure investment last month, of which Union and State governments will contribute at least 75 per cent.
