The infrastructure sector in India is buzzing again — but this time, it’s not domestic retail investors or mutual funds leading the charge. Instead, foreign pension funds from Canada, Norway, and Singapore are stealthily increasing their exposure to select Indian infrastructure companies in 2025.
So what do they know that the average Indian investor doesn't? Let's break it down.
My Surprise Discovery at a Small-Cap Investing Seminar
Last month, I attended a niche investor seminar in Mumbai — mostly to network. But something one fund manager said changed how I look at the infrastructure theme.
He said:
"Pension funds aren't after 5x returns. They want safe, regulated long-term cash flow — and India’s infra space is perfect for that now."
When I came home, I started tracking their holdings. What I found shocked me. Foreign pension giants had already made quiet but substantial moves into select Indian infrastructure players that are off most retail investors’ radar.
Here are 3 such stocks I believe retail investors should watch before they make headlines.
1. Ircon International Ltd. — The Dark Horse of Rail Infra
- Strong order book of over ₹34,000 crore
- Consistent profit growth and high ROE
- Government backing + international railway contracts
After ignoring IRCON for years, I finally looked at its fundamentals — and was impressed. No debt, consistent dividend payouts, and upcoming railway electrification projects make it a hidden gem.
2. KNR Constructions — The Silent Performer in Road Projects
Why pension funds
like it:
- Strong execution record in NHAI highway projects
- Asset-light model with consistent margins
- Presence in high-growth states like Telangana and Tamil Nadu
My experience:
A friend working in a private equity firm told me KNR was on their shortlist because of its zero promoter pledging and strong balance sheet. That's rare in the infra space.
3. PNC Infratech — Building
the Backbone of Bharat
- Aggressive highway project wins under Bharatmala
- Huge opportunities from PM Gati Shakti plan
- Long-term contracts = stable cash flows
- Look for: Q2FY26 results — signs of margin improvement may lead to FII upgrades
- Stable Government Policy: Infra push continues in Budget 2025
- Attractive Valuations: Compared to global peers, Indian infra firms offer better growth at lower PE
- Long-term Visibility: Road, rail, and port projects have 5–10 year timelines — ideal for patient capital
“These funds want
stability, not just returns. Indian infra finally offers both.” — My analyst
friend at a Singapore-based fund
How Retail Investors
Can Play This Theme Smartly
- Avoid small infra companies with high debt or poor order execution
- Focus on firms with healthy order books, steady margins, and no promoter pledging
- Watch for signals: Government contracts, FII holding changes, and dividend announcements
Final Thoughts: Don’t
Wait for TV Analysts to Tell You
If you’re a long-term investor tired of overhyped penny stocks, consider tracking these lesser-known infrastructure gems — the smart money already is.
FAQ
Q1. Why are foreign pension funds buying Indian infrastructure stocks in 2025?
They’re attracted by stable cash flows, government-backed projects, and long-term policy support.
Q2. Are infra stocks safe for long-term retail investors?
Only if they’re debt-free, consistent in execution, and have strong order books.
Q3. Which infra stock is backed by the government?
IRCON International is a government PSU with strong global presence and consistent growth.
Please do not enter any spam link in the comment box.