Ahead of Budget 2026, markets are positioning for continued heavy public capex in roads, railways, and energy, with clear sector-specific triggers and a strong thematic bid in related stocks. As a “lead-up to budget”, we shall highlight the current positioning of each of these sectors, with prominent listed plays in each space.
In the run-up to Budget 2026, commentary from brokers and policy watchers converges on one core expectation: the government is unlikely to dilute its highway and logistics capex push, given its linkage to growth, job creation, and election-cycle commitments. The focus has shifted from only announcing new corridors to ensuring faster execution on Bharatmala, multimodal logistics parks, and last-mile connectivity to economic clusters.
If we focus our attention on the commentary that is leading up to the budget, we can conclude that:
• likelihood of sustained or mildly higher allocation to the ministry of road transport and highways, with emphasis on economic corridors, border roads, and expressways.
• greater use of hybrid annuity model (HAM) and TOT/InvIT structures to recycle capital.
On the ground, order inflows for key EPC players have remained healthy through FY25-26, supported by continuous tendering from the NHAI and state agencies. Analysts are watching for any budget signal on resolving contractor payment delays, faster dispute resolution, and more predictable cash flows, which are critical for re-rating the space.
Here are some prominent listed stocks in the roads and related infrastructure sector:
• Larsen and Toubro Ltd
• IRB Infrastructure Developers Ltd
• Ashoka Buildcon Ltd
• KNR Constructions Ltd
• PNC Infratech Ltd
• Dilip Buildcon Ltd
• HG Infra Engineering Ltd
• G.R. Infraprojects Ltd
These names tend to see some buying interest from retail participants ahead of the budget. In this sector, whenever there is visibility on higher road and logistics allocations and many have strong order books with a rising share of central and state road projects.
Let’s try to comprehend, based on their historical performance, how the above companies have performed in the last six months.
Based on the above relative strength comparison chart, we are highlighting peers' performance and notice a clear shift in momentum in two stocks—Larsen & Toubro and Dilip Buildcon—that seem to be benefiting from infra spending momentum, aligning with cement sector optimism. On the other hand, the laggards face execution delays or cost pressures, with GRNR and KNR hitting multi-month lows. Overall, the sector shows recovery potential through 2026, favouring top performers like L&T and DBL, which can continue to see demand ahead of the budget.
Based on the above relative performance, let’s arrive at some perspective through the price action to conclude on these two names as suitable candidates from the roads section in a lead up to the budget.
LARSEN & TOUBRO (L&T) Cmp ₹3,869.80
In 2025, L&T demonstrated strong momentum across infrastructure, technology, and energy, securing major contracts in transportation, hydrocarbon, and building projects while expanding into sovereign cloud and sustainable construction solutions. These wins reinforced its leadership in India’s infrastructure and industrial ecosystem.
L&T maintained a robust growth trajectory in 2025, marked by significant project wins and strategic partnerships across diverse sectors. The company’s transportation infrastructure business secured multiple large orders in December, underscoring its continued dominance in road and metro projects. Its Hydrocarbon Onshore division also bagged major contracts, reflecting strong demand for energy infrastructure. In the buildings and factories segment, L&T won large-scale projects, highlighting its role in shaping India’s urban landscape.
This counter has been a pioneer in the area of infrastructure; however, late-2024 to mid-2025 had been disappointing until some encouraging news flows in terms of orders and re-rating by brokerages, followed by earnings surprise in the second half of 2025, have really pushed the needle. The thrust we see on the charts is that the push above 3,900 has attracted some attention. The momentum is also seen showing some promise, while price action is still awaiting some response.
On the charts below, at a higher timeframe, the median line seems to be holding back the trends; however, the positive scenario developing in the lead-up to the budget has helped prices scale higher, and some triggers from the event could help revive sentiment. Post-budget moves could unfold a move towards 4,600, within the next six months. The above justification is invalidated if the price moves below 3,700.
These achievements in late 2025 positioned L&T for resilience amid global uncertainties. By balancing traditional infrastructure with emerging technology-driven solutions, L&T strengthened its long-term growth outlook. The company’s ability to integrate engineering excellence with digital innovation continues to make it a key driver of India’s industrial and infrastructure transformation.
DILIP BUILDCON (DBL) Cmp ₹472.30
DBL has recently strengthened its project pipeline with notable wins, including a ₹3,400 crore EPC contract for the Ganga Path project in Bihar awarded by Adani Road Transport in January 2026, and its emergence as the preferred bidder for a ₹5,000 crore mining project from NALCO in November 2025. These developments enhance long-term revenue visibility and reinforce DBL’s position in infrastructure and mining.
However, the company has faced quarterly revenue pressures and cautious investor sentiment during late 2025 and early 2026, reflecting broader challenges in the construction sector.
While translating their journey on the charts, we can note that, compared to the other players, DBL seems to be generating steady growth throughout 2025 and has formed a bottom around 380-400. The company witnessed revenue contraction and declines in some quarters, but also strong returns on specific projects. This has helped the company sustain the cyclical nature of the market through 2025.
Now, ahead of the budget, we note that prices are showing some resolve to move higher, and the sector trend is also helping a revival. With the formation of a strong long body candle and improving volumes, a move towards 650 is possible within the next six months, with a stop placed at 380.
Despite these headwinds, DBL remains focused on diversifying its portfolio with significant railway and mining orders, while simultaneously working to reduce debt and improve working capital efficiency. Market reactions to its stock continue to be influenced by the balance between new project wins and sector-wide trends, underscoring DBL’s ongoing efforts to sustain growth and financial resilience.
Conclusion
Overall, the market sentiment remains poised for steady moves; however, we need to tread these sectors carefully. In this edition, we have spoken about two promising candidates from the infrastructure sector. The tailwind from the environment, combined with the event, could help the prices scale higher.
Raja Venkatraman is co-founder, NeoTrader. His Sebi-registered research analyst registration no. is INH000016223.
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