The country-wide lockdown imposed by the government to check the spread of cornonavirus has resulted in construction companies announcing a shutdown of operations. This is likely to delay implementation of projects, leading to cost overruns and impacts on the workforce.
Typically, the fourth quarter accounts for about 30-35 per cent of annual revenues for construction companies, and a month’s lockdown could erode 8-10 per cent. This would impact project execution of infrastructure companies and their revenue growth, according to Sudeep Arekar, senior analyst, India Ratings and Research.
With the lockdown, all the construction activity has come to a halt. A large chunk of construction workers are heading to their home-towns and are likely to return only after the situation comes back to normal. The impact of the halt in work will have direct bearing on the company revenues, jobs and project delays.
