Private capex rises, but India’s credit growth cycle remains weak: Kotak
AI Summary
The current trend of rising project loan sanctions, particularly in the infrastructure sector, signals potential growth for companies involved in power and construction. However, the lack of a corresponding uptick in overall credit growth suggests that retail investors should remain cautious, as the anticipated capital expenditure boost may not yet translate into broader economic momentum. Investors should keep an eye on regional performance, especially in Maharashtra and Gujarat, as these states continue to attract significant funding.
India’s private sector investment cycle has yet to translate into a strong credit growth cycle, despite fresh project loan sanctions rising 18 per cent year-on-year in FY26, with infrastructure, especially power, continuing to attract a major share of bank funding, according to a report by Kotak Institutional Equities.
The Reserve Bank of India’s (RBI) latest bulletin projected capital expenditure by India’s private corporate sector to increase to Rs 3.2 trillion in FY27 from Rs 2.6 trillion in the previous fiscal.
Original Article
Published on Hindu BusinessLine
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This is a economy news update from Hindu BusinessLine, published on 30 September 2026.
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