New Delhi, Oct 14 India’s leading corporates may double spending and capital expenditure over the next five years, driven by rising revenues and profits, a report said on Tuesday.
The report by ratings firm S&P Global Ratings noted similarities to China’s corporate growth in the 2000s and India’s corporate growth, highlighting that a huge revenue surge is expected for India’s top companies.
S&P projected India’s corporate capital spending to reach approximately $800 billion from fiscal 2026 to fiscal 2030, largely driven by infrastructure investments.
An additional $1 trillion investment is expected from fiscal 2031 to 2035 for advanced research and development, the report noted.
“Improving infrastructure, political stability, and lean corporate balance sheets are propelling large expansion plans that will widen revenue bases for Indian corporates,” said S&P Global Ratings credit analyst Neel Gopalakrishnan.
“Supportive government policies are helping — these include a focus on domestic self-sufficiency, more exports, and development of a supply-chain ecosystem,” he added.
“Our baseline view is that India’s growth momentum will stay strong, and its industrial base and supply chains will get deeper and more efficient,” said Gopalakrishnan.
These factors are similar in scope to the momentum that created years of rapid expansion and market gains for China’s corporate sector in the 2000s, the report noted.
China’s expansion in the 2000s was driven by reduced trade barriers, significant foreign investment, and double-digit GDP growth.
“Indian companies will face tighter financing conditions than their Chinese counterparts during their high-growth phase. Such conditions, however, could help Indian companies avoid a large debt buildup as occurred for many Chinese corporate sectors,” the ratings firm said.
S&P projected that leading Indian corporates could more than double their EBITDA over the next decade without significantly increasing leverage.
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