Private Capital Expenditure by Large Enterprises Expected to Moderate Next Year Despite Strong Current Momentum: Government Survey

Private Sector Capex in India Expected to Moderate in FY27

According to a recent survey by the National Statistics Office (NSO), private sector investment in large enterprises in India is expected to slow down in the upcoming financial year. The survey, released on March 23, indicates that while corporate capital expenditure (capex) remains robust in 2025-26, growth is likely to be muted in 2026-27.

The survey estimates aggregate private capex at Rs 11.44 lakh crore in FY26, but investment intentions for the following year fall to Rs 9.55 lakh crore, indicating a slowdown in expansion plans. However, the survey notes that companies tend to provide conservative projections for future spending, suggesting that the eventual outturn may be higher than current intentions.

A like-to-like comparison of 3,819 enterprises suggests that investment may not contract outright but stabilise. Capex among these firms is projected at Rs 6.114 lakh crore in FY27, almost unchanged from Rs 6.112 lakh crore in FY26 and Rs 6.001 lakh crore in FY25.

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The current capex cycle remains broad-based and focused on strengthening core operations, with 49% of firms investing in new asset creation and 38% allocating funds towards upgrading existing assets. 65% of capex is financed through internal accruals, pointing to healthier corporate balance sheets and limited dependence on external borrowing.

Emerging sectors are beginning to feature in investment plans, with 7% of firms reporting investments in green energy and 6% investing in robotic equipment in the manufacturing sector. Across all sectors, about 3% of firms are deploying robotics, signalling gradual adoption of automation and new technologies.