Afcons carries Rs 1,042.46 crore in unresolved project claims

Afcons Infrastructure Limited carried Rs 1,042.46 crore in recorded or disclosed recoverable amounts across three disputed projects at September 30, 2026, while arbitration and court proceedings remained unresolved. The largest amount was Rs 837.08 crore relating to two Chennai Metro packages, with management and joint-venture management treating the balances as recoverable despite uncertain outcomes.

How much has Afcons recorded in disputed project claims?

Afcons has recorded or disclosed Rs 1,042.46 crore across the Chennai Metro, Dahej standby jetty and Chenab bridge matters as at September 30, 2026. The total comprises Rs 837.08 crore for Chennai Metro packages, Rs 90.38 crore for Dahej and Rs 115 crore for the Chenab bridge project.

The Rs 1,042.46 crore is not presented under a single balance-sheet line. It includes non-current contract assets, non-current trade receivables and other non-current financial assets, meaning the total represents claimed or awarded amounts recorded under several asset classifications rather than a single cash receivable.

The total does not represent a settlement or cash collection. Afcons states that the duration and outcome of the Chennai Metro, Dahej and Chenab proceedings are uncertain, even though the company or relevant joint venture considers the associated amounts good and recoverable based on assessments, technical evaluations and legal opinions.

What is the Chennai Metro dispute involving Afcons?

The Chennai Metro matter is the largest of the three disclosures at Rs 837.08 crore and relates to packages UAA-01 and UAA-05 executed by the Transtonnelstroy Afcons Joint Venture. The joint venture submitted variations for cost overruns associated with unforeseen geological conditions, delayed land handover and changes in the scope of work.

Of this amount, Rs 659.87 crore is recognised as non-current contract assets for variations and claims. Another Rs 120.81 crore is recognised as non-current trade receivables for an arbitration award, while Rs 30.63 crore of interest on that award and Rs 25.77 crore for a bank guarantee encashed by the client are shown as other non-current financial assets.

The joint venture's management says the matters are attributable to Chennai Metro Rail Limited under the contract and is confident of a favourable order or award. Proceedings were in arbitration, the Madras High Court and the Supreme Court as of September 30, 2026, and the filing does not give an expected collection date for the Rs 837.08 crore.

What is happening with the Dahej standby jetty claim?

The Dahej Standby Jetty Project Undertaking has Rs 90.38 crore recorded as recoverable while its challenge to an unfavourable earlier arbitration award remains before the Delhi High Court. The unfavourable award concerned liquidated damages for delay in completing the works.

The disclosed Dahej amount includes Rs 79.28 crore in other non-current financial assets and Rs 11.10 crore in non-current contract assets. The joint venture has also submitted claims for extended-stay and acceleration costs, contending that the delay was attributable to the client and that recovery is permitted under the contract.

The Delhi High Court had admitted the petition and hearings were in process at the reporting date. Dahej differs from the Rs 837.08 crore Chennai Metro matter because the filing specifically identifies an unfavourable arbitral award, but joint-venture management still considers the Rs 90.38 crore recoverable after its assessment and legal opinion.

What does Afcons claim on the Chenab bridge project?

Afcons has recorded Rs 115 crore as non-current contract assets for claims relating to the steel arch bridge across the Chenab river. Konkan Railway Corporation Limited awarded the contract on August 24, 2004, and the project was completed on August 3, 2023.

The Rs 115 crore claim covers additional expenses for extended stay, categorisation and excavation work, loss of productivity and a change in alignment. Afcons says these costs are attributable to the client under the contractual provisions, although the filing does not provide separate amounts for each head of claim.

The claims were in arbitration and the High Court at September 30, 2026. Afcons management says it is confident of a favourable judgment and recovery after considering the status of arbitration, historical experience, technical evaluation and legal opinion, but it also states that the duration and outcome remain uncertain.

How do these claims compare with Afcons's financial position?

The Rs 1,042.46 crore in specifically disclosed disputed matters compares with Rs 2,045.56 crore of total non-current contract assets at September 30, 2026. Non-current contract assets rose by Rs 548.52 crore from Rs 1,497.04 crore at March 31, 2026, while current contract assets declined by Rs 25.11 crore to Rs 6,209.35 crore.

Afcons also reported Rs 183.33 crore of other income as interest on an arbitration award in its favour during the quarter and half year ended September 30, 2026. Total other income was Rs 271.03 crore in the September quarter, compared with Rs 55.68 crore in the June 2026 quarter and Rs 112.54 crore in the September 2025 quarter; the filing does not link the interest income to a named project.

Contract assets also featured in cash flow for the half year ended September 30, 2026. The cash-flow statement shows a Rs 682.22 crore increase in contract assets and Rs 340.33 crore of net cash used in operating activities, compared with Rs 668.64 crore used in the half year ended September 30, 2025; Afcons does not identify the portion related to the three disputes.

Conclusion

Afcons's September 30, 2026 disclosures show Rs 1,042.46 crore of recorded or disclosed recoverable amounts connected with contested infrastructure contracts. Chennai Metro accounts for Rs 837.08 crore, Dahej for Rs 90.38 crore and Chenab for Rs 115 crore, with management relying on contractual assessments, technical evaluations and legal opinions while acknowledging that none of the proceedings has a certain outcome.

The next developments to watch are orders or awards in the Chennai Metro arbitration, Madras High Court and Supreme Court proceedings, the Delhi High Court hearings on Dahej, and the Chenab arbitration and High Court matter. Afcons has provided no settlement date or recovery target for the Rs 1,042.46 crore, so case progress will determine the timing and extent of any realisation.