RBI Analysis: Private Corporate Investment in India: Trends, Financing Patterns, and Outlook for 2024-25 and 2025-26
SDG 8: Decent Work and Economic Growth)
SDG 9: Industry, Innovation, and Infrastructure
Institutions: Reserve Bank of India; Department for Promotion of Industry and Internal Trade
The RBIβs analysis of private corporate investment shows a decline in project sanction costs for 2024-25, highlighting cautious optimism among Indian firms. Despite reduced investment announcements, firms maintain higher cash buffers, and robust macroeconomic factors, availability of multiple financing channels, and infrastructure investments support future capex potential.
Most sanctioned projects were geared towards greenfield development, with infrastructure, especially the power sector, accounting for a majority share. Regionally, Gujarat, Maharashtra, Andhra Pradesh, Rajasthan, and Uttar Pradesh comprised about sixty per cent of the project value. Funds raised through external commercial borrowings and initial public offerings supplement traditional bank financing.
Looking ahead to 2025-26, a moderate increase in pipeline capital expenditure is expected, underpinned by improved corporate balance sheets and easy liquidity, though uncertainties in global demand may influence actual investment realisation.
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