NCC shares recovered from intraday lows on Thursday, February 19, after initially declining 9.86% to hit ₹135 on NSE and 9% to hit ₹136 on BSE following the company's announcement of debarment from the National Highways Authority of India (NHAI). According to Zee News, the stock later recovered to trade 0.85% lower at ₹148 as of 11:43 am, showing resilience after the sharp initial decline. The recovery came after the infrastructure company and its subsidiary faced action from the highway authority, with the significant market reaction reflecting investor concerns over the two-year ban on participating in NHAI tenders.
Infrastructure company NCC Ltd announced on Wednesday (February 18) that it and its step-down subsidiary OB Infrastructure Ltd have received an order of debarment from the National Highways Authority of India (NHAI). According to the company's exchange filing, NHAI has debarred OB Infrastructure Ltd (OBIL), the concessionaire, and NCC Ltd, the promoter of the concessionaire, from participating in any tender, bid or request for proposals issued by NHAI for a period of two years with effect from February 17, 2026. As per Zee News, the debarment restrains the entities from participating in any capacity, including concessionaire, contractor, EPC contractor, O&M contractor, O&M agency or consortium member. The order was received at 6.08 pm on the same day.
The debarment relates to the project for design, engineering, construction, development, finance, operation and maintenance of 220km to 255km of Orai-Bhognipur section on NH-25 and 421km to 449km of the Bhognipur-Barah section on NH-2 in Uttar Pradesh on a BOT (Annuity) basis. According to Zee News, OBIL had executed this project under a concession agreement dated April 26, 2006, with the company stating that execution of the project was delayed due to the delay in handing over of land and other breaches by NHAI. The company clarified that OBIL had constructed and maintained the Project as per the terms of the Concession Agreement dated April 26, 2006.
According to the report, OBIL had initiated arbitration proceedings against NHAI and received a favourable award dated November 20, 2024. However, the award has been challenged by NHAI before the Delhi High Court, and the matter is currently pending. There are additional disputes between OBIL and NHAI relating to the execution and maintenance of the project, for which OBIL initiated arbitration proceedings in September 2025. As reported by Zee News, NHAI initiated the debarment proceedings during the pendency of the arbitral proceedings. OBIL is contending that the debarment order has been issued after completion of the concession period without providing the opportunity of being heard, in violation of principles of natural justice and shall challenge the same as per the law.
NCC shares witnessed a spike in trading activity with volume on NSE spiking by 10 times to 1.88 crore shares compared with an average trading volume of 19 lakh shares, as per Upstox. On the BSE, as many as 15 lakh shares changed hands compared with an average of 1.95 lakh shares traded daily in the past two weeks. As of 11:43 am, NCC shares traded 0.85% lower at ₹148, underperforming the NIFTY Smallcap 100 index which was down 0.3%. The stock is down nearly 21.3% over the past year and about 8% year-to-date, with its 52-week high standing at ₹242.15 hit in June 2025. The company has a total market capitalisation of approximately ₹9,362 crore and is part of the Nifty Smallcap 100 index.
The ban applies only to new tenders and ongoing projects continue unaffected by the debarment. However, Q3 FY26 net profit declined approximately 36.6% and revenue fell around 9%, highlighting existing financial pressures before the regulatory action. According to Meyka AI, analysts expect NCC to pivot to state projects, private contracts, or other sectors to sustain growth, with some anticipating a bounce if NCC wins contracts outside NHAI. The company emphasized that there is no financial or operational impact on its existing order book or ongoing projects, though any impact on future tenders will depend on business opportunities arising during the debarment period. Market analysts suggest that the company's plan to legally challenge the debarment could be a key factor in restoring investor confidence, with investors closely monitoring court outcomes, new project wins outside NHAI, and quarterly earnings results for signals on recovery.
