AbstractExisting models have failed to capture the stochastic nature of input variables for the value-for-money (VfM) analysis in build–operate–transfer (BOT) infrastructure projects. The present study aims to address this knowledge gap by offering a VfM-at-risk analysis model and developing a stochastic-based model that takes account of the risk allocation scheme and cost efficiency in the valuation. The proposed model can deal with the net-cost and net-revenue projects. This study introduces weighted risk reduction factors to accommodate the interaction between public and private agencies in sharing risk outcomes and a metric to measure the optimality of a risk allocation scheme. A case study based on Indonesia’s BOT water supply project was used to demonstrate the model application. It is shown that cost efficiency and an optimal risk allocation scheme enhance VfM. Moreover, the wisdom of using the BOT option can be challenged when the public agency is at least as good as the private agency unless other reasons exist, and allocating project risk to an agency that cannot best deal with it can reduce VfM. This study concludes with model limitations and directions for future research.