Recent government initiatives on the infrastructure front have led to optimism about the end of ‘policy paralysis’. A meeting chaired by the Prime Minister had recently set sectoral targets for infra for FY13. In this light, we analyse the targets and their feasibility. In the roads space, concerns on funding and EPC regulatory framework may hamper project award, though road construction should improve. Railway PPP projects may not see much progress, but the Dedicated Freight Corridor (DFC) is likely to sail through. Goa airport award is likely to be the only silver lining in the airport sector while project award in ports sector is likely to be sluggish. In the power space, concerns on fuel supply may hamper capacity addition. We remain bullish on the road development space and reiterate IL&FS Transportation (ITNL) and Sadbhav Engineering (Sadbhav) as our top picks. Among contractors, we prefer NCC and Simplex.
