Indian CPSEs reach 43% of their Capex targets in H1FY23

India’s Central Public Enterprises (CPSE), including the Railways and National Highways Authority of India (NHAI) has achieved 43% of their combined annual capital expenditure (Capex) target in FY23’s April-September period, by spending INR 2.85 trillion, according to media reports.

A Capex target of INR 6.62 trillion has been allocated to 54 CPSEs and 5 government departments this year, which have an annual Capex of above INR 100 crore. 

According to the reports, the NHAI and railways have reported high Capex growth rates in the first half of FY23. Experts said that these two departments with their high budgetary support have been the country’s largest public sector, and are expected to play an important role in crowding in Capex from other enterprises.  

The reports further added that the Centre’s budgetary Capex reached 45.7% of the annual target at INR 3.43 trillion in the first half of this year. During the same period last year, the amount reached 41.4% of the Capex at INR 2.3 trillion. Investments in railway projects reached INR 88,548 crore in the first half of 2022, registering a 91% growth. 

The June quarter of FY23 saw an increase in gross fixed capital formation by 20.1% compared to the same month last year. It was mainly driven by the government’s budgetary Capex. The previous quarter’s growth stood at 5.1%. 

In terms of other entities, Indian Oil Corporation, ONGC and BPCL reached 48%, 39%, and 67% of their annual Capex targets, respectively, in the first half of this year.

As per the reports, capital expenditures by 40 entities that have annual Capex budgets above INR 500 crore have reached 37% of their 2022 Capex target at INR 2.19 trillion, in the year’s first half. 

 
Source: Financial Express