Higher investments in power, particularly renewables, and in airlines will be major spending areas

FPJ News Service mumbai

India’s major companies will spend $800-$850 billion over the five years to 2030, double the amount spent in the previous five-year period,” S&P Global Ratings said on Tuesday. Corporate India looks set to double capital expenditure over the next five years to chase growth opportunities, “We believe these hefty spending plans are more likely to strengthen than weaken credit profiles.

“Indian companies are well positioned for a growth run,” said S&P Global Ratings credit analyst Neel Gopalakrishnan. “Barring execution mistakes or negative macro changes, these investments should boost business scale without driving up leverage.” Balance sheets are the leanest they’ve been in years. Companies are investing to meet demand, underpinned by favorable government policies and a positive economic outlook. Successful execution of plans would enlarge their operational scale, providing lasting cost benefits and business efficiencies.

Higher investments in power, particularly renewables, and in airlines will be major spending areas. Investments in airports could double, or even triple during this period. Conventional sectors such as steel, cement, oil and gas, telecom, and autos will grow at a more steady pace of 30%-40%. Investments will be largely financed by operating cash flows, except the power sector, and facilitated by domestic funding options.