Power, airlines, GH2 to drive India Inc.’s $850 bn capex surge

Indian companies are set to nearly double their capital expenditure (capex) to $850 billion over the next five years, driven largely (75%) by the power sector, airlines, and emerging industries such as green hydrogen (GH2), S&P Global Ratings said on Monday.

- Palazhi Ashok Kumar

External funding needs are expected to remain modest, except in power.

“Improving credit quality among corporates and banks is driving offshore appeal of India. We expect continued solid corporate earnings, without any material increase in leverage.

“Our analysis of more than 2,000 Indian companies suggests that over 40% of their debt could be considered investment grade. This is up from about 17% in 2020. This considerably reduces default risk for banks,’ S&P sources told FPJ Money.