Infra sectors drove corporate investment uptick in FY25: Bank of Baroda

Corporate investment saw a steady rise in 2024-25, driven largely by infrastructure-intensive sectors, according to a report released Wednesday by the Bank of Baroda’s Economic Research Department.

The report, based on data from 1,393 companies across 122 industries that disclosed balance sheet details in their FY25 results, found that gross fixed assets—including capital work in progress—rose to ₹28.50 trillion from ₹26.49 trillion in FY24, marking an annual growth of 7.6%.

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Refineries accounted for the largest share of fixed assets at 31%, followed by telecom services (8.6%), iron and steel products (5.9%), cement (5.4%), and power (4.8%), said the report titled ‘Which industries are investing?’ 

Together, these five sectors comprised 56% of the total fixed assets, underscoring the central role of core infrastructure industries in capital formation.

The next five industries by share of fixed assets—public sector banks (PSBs), private sector banks (PVBs), chemicals, industrial gases, and non-ferrous metals—collectively accounted for another 14.5%.

Meanwhile, passenger cars, FMCG (household products), pharmaceuticals, IT software, and sponge iron made up another 10.4% of fixed assets.

To be sure, these 15 industries represented nearly 81% of corporate fixed assets in FY25, indicating their pivotal role in driving capital expenditure.

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The report, which analyses balance sheet data from FY25 across 122 industries, offers a granular view of corporate India’s investment patterns.

“Most of the leading sectors in terms of being those that drive investment in the country are in the infra (infrastructure space and have registered impressive growth rates,” the report said.

“The picture is diverse for consumer-oriented industries, which should show more traction in the coming year (FY26)0 when consumption shows a revival. Demand in some of these sectors has been mixed, especially in urban areas, and the measures announced by the government, as well as declining inflation, should help to reverse the same,” it added.

Meanwhile, in the Bank of Baroda survey, sectors like cement, passenger cars, PVBs, PSBs, drugs and pharma, steel/sponge iron and refineries outpaced the average growth in fixed assets.

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“In case of cement and steel, the linkage was with government capex, where fresh capacities were set up to meet rising demand. In the case of refineries, it was part of the drive to invest in capital for expansion purposes. At the consumer end, drugs and pharmaceuticals were reflective of new capacities being set up for meeting both domestic and export demand,” the report said.

“In the case of banks, it was clearly a case of them investing heavily in technology as well as setting up new branches where the property was owned by them,” it added.