Sadbhav Engineering is an Indian infrastructure builder that has spent nearly four decades carving roads, canals and metro lines out of the country’s hardest terrain - it is, at its core, a government contractor that turns public-works budgets into physical assets. Founded in 1988 in Ahmedabad and now led by Chairman Shashin V. Patel, the company grew by winning fixed-price engineering, procurement and construction (EPC) contracts from clients like NHAI and Coal India, and later used that construction muscle to build its own portfolio of toll-road concessions. The recurring approach is simple: bid for large, multi-year public infrastructure jobs, execute them with in-house teams and heavy machinery, and where the concession terms allow, collect a steady stream of user fees long after the concrete has set. # Business segments Three engines, one construction backbone - a core EPC contracting business that does the heavy lifting, a portfolio of toll and annuity road concessions that were meant to generate recurring income, and a small wind-power operation that sells electricity to the grid. ## 1. Construction & EPC: the government’s builder **The company wins fixed-price contracts to build roads, highways, bridges, metro railways, canals and mines for public-sector clients, earning revenue as work progresses - it is a project-execution machine, not a product seller.** - **Paid by the percentage of work done** - revenue on fixed-price contracts is recognised over time based on the cost of work performed plus a proportionate margin, so income tracks physical progress on site rather than a single completion milestone. - **Roads are the mainstay** - the company has constructed over 9,621 lane kilometres of roads and highways and completed 43 highway projects across EPC, BOT and item-rate models, making transportation infrastructure its largest calling card. - **Canals and mines fill the order book** - the irrigation division has laid more than 819 kilometres of canals, while the mining division has moved over 574 million cubic metres of earth, mostly for coal-mining clients, which diversifies the project pipeline beyond roads. - **Joint ventures spread the risk** - the company operates through 16 active joint-venture arrangements with partners, holding project shares ranging from 40% to 98%, so it can bid for larger contracts while limiting its own capital at stake. - **Cost overruns are its own problem** - because contracts are fixed-price with no pass-through of higher costs, the company bears the full risk of material price spikes, land-acquisition delays and client-caused stoppages; claims for those overruns sit in arbitration and negotiation, sometimes for years. ## 2. Infrastructure Development (BOT/HAM/Toll Roads): the concession portfolio **The company builds roads, then collects tolls or annuity payments over multi-decade concessions through a web of subsidiary special-purpose vehicles - an asset-ownership model that was meant to generate recurring cash flow but has become a restructuring story.** - **Two ways to get paid** - under toll-based concessions, revenue comes from user fees collected at toll plazas; under annuity-based (Hybrid Annuity) concessions, the government pays fixed semi-annual sums, reducing traffic-risk for the company. - **A separate legal universe** - every road concession sits inside its own subsidiary or step-down subsidiary, each with its own bank debt and lender agreements that require the parent to pledge its shares and maintain minimum holdings. - **Toll roads are maintained, not just owned** - the group sets aside provisions for major maintenance because concession agreements oblige it to restore the road to a specified condition before handing it back, and it runs third-party audits on its toll-collection systems to plug leaks. - **The structure carried more debt than the roads could support** - subsidiaries like Rohtak-Hissar Tollway had their debt assigned to the government’s bad bank (NARCL), while Sadbhav Bangalore Highway faced lender recovery actions, and the net worth of key concession-holding subsidiaries was fully eroded as early as FY20. ## 3. Wind Power Generation: a small green electron stream **The company operates wind turbines and sells the electricity to the local distribution company - a tiny, standalone generation business that runs alongside the construction core.** - **Metered and sold at the delivery point** - revenue is recognised when electricity is delivered to the distribution company at a common delivery point, measured by meter reading, making it a simple volume-based utility income stream. # Group structure and partners **A heavily layered corporate structure with two direct subsidiaries, a cascade of project-specific step-down vehicles, and a lender consortium that now holds restructuring rights over the entire group.** - **Two direct subsidiaries hold everything** - Sadbhav Infrastructure Project Limited (SIPL, 69.76% owned) acts as the holding company for all road-project SPVs, while Sadbhav Gadag Highway Private Limited (74% owned) holds a single Hybrid Annuity road project in Karnataka. - **The step-down layer is deep** - SIPL controls step-down subsidiaries, each ring-fenced for a specific road concession, including entities for ring roads in Ahmedabad and Jodhpur, border check-posts in Maharashtra, and highway stretches across Gujarat, Karnataka, Haryana and Uttarakhand. - **A failed merger and a stalled simplification** - a Scheme of Amalgamation to merge SIPL into the parent was approved by boards and shareholders with 100% votes in favour, but was withdrawn in October 2022, leaving the two-tier structure intact. - **Lenders are now deeply embedded** - under the Master Restructuring Agreement implemented in March 2026, six lenders restructured Rs. 1,516.71 Crores of debt, with fund-based exposure converted into non-convertible debentures and lenders gaining the right to appoint nominee directors to the board.