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The National Highways Authority of India (NHAI) has barred NCC Limited and its step-down subsidiary, O B Infrastructure Limited, from participating in any NHAI tenders for two years. The action relates to disputes over a 2006 build-operate-transfer annuity project in Uttar Pradesh. NCC has said the order will not impact its existing projects or order book but will affect its ability to bid for new NHAI contracts during the restriction period. The company plans to challenge the debarment legally, while its shares fell sharply following the announcement.
The National Highways Authority of India (NHAI) has debarred NCC Limited and its step-down subsidiary O B Infrastructure Limited from participating in any tenders, bids or requests for proposals issued by National Highways Authority of India for a period of two years. The restriction became effective in mid-February 2026 and applies across all roles, including concessionaire, EPC contractor, operations and maintenance contractor, or as part of a joint venture or consortium. Advertisement
The decision is linked to disputes arising from a highway project in Uttar Pradesh that OB Infrastructure executed under a concession agreement signed in 2006 on a build-operate-transfer (BOT) annuity basis. The company stated in its regulatory filing that project delays were mainly due to delays in land acquisition and other obligations that were the responsibility of NHAI. It further indicated that the concession period has already ended.
OB Infrastructure had initiated arbitration proceedings in connection with these disputes and secured a favourable award in late 2024. However, NHAI challenged the arbitral award before the Delhi High Court. The subsidiary also initiated additional arbitration proceedings in late 2025 concerning related claims. NCC informed exchanges that the debarment order was issued while these legal proceedings were ongoing and that it was passed without granting the company an opportunity to present its case. The company said it intends to challenge the order through appropriate legal remedies.
NCC clarified that the debarment does not affect its existing contracts, ongoing execution, or current order book. The company has a diversified portfolio across roads, buildings, water, electrical and irrigation segments, and NHAI projects form only a part of its total business. However, the restriction will prevent the company and its subsidiary from bidding for fresh NHAI highway projects for two years, which may affect future order inflows from the highways segment.
Following the disclosure, NCC's shares declined sharply in market trading before recovering partially later in the session. The reaction reflected investor concern over the temporary loss of access to one of the country's largest public sector infrastructure awarding authorities. NHAI has been a key agency driving highway expansion under central government programmes, making its tender pipeline important for road developers and contractors.
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