India Capex Momentum Central government drives capex momentum

Research evidence excerpt

India Capex Momentum Central government drives capex momentum

10 June 2026

India Capex Momentum EquitiesConstruction & Engineering

Central government drives capex momentum India

◆ Capex spending by the central government and PSUs Puneet Gulati*, CFA

remains robust Senior Analyst, India Energy, Property & Infra HSBC Securities and Capital Markets (India) Private

Limited

◆ Roads, power, and railways drove project additions in Apr’26 puneetgulati@hsbc.co.in

+91 82 9189 7591

◆ While PMI maintained its growth momentum, IIP and core Sandesh Shetty*

Analyst, India Industrials

industries moderated amidst geopolitical uncertainties HSBC Securities and Capital Markets (India) Private

sandesh1.shetty@hsbc.co.in

Central government and PSUs continue to deliver on the capex promise: The +91 89 8338 6423

central government capex continues to trend better compared to last year with Apr’26

growth coming in at 19% y-o-y and the government achieving 16% of its full-year * Employed by a non-US affiliate of HSBC Securities (USA) Inc, and is not registered/ qualified pursuant to FINRA regulations

target vs 15% in the previous year. Railways (+69% y-o-y) and Defence (+50%)

delivered strong growth, while roads remained steady (+3% y-o-y). PSUs maintained

its growth momentum at 15% y-o-y in May’26, achieving 17% of the FY27 target (vs

14% in FTD May’26). State capex growth moderated to 8% in FY26 (vs 11% in FY25).

Railways, power, and roads led new project additions in Apr’26: As per MoSPI, 55

new projects were added to the central sector infrastructure project pipeline in Apr’26.

Railways, power, and roads contributed c67% of the new project additions. Key

projects include Bangalore Metro Rail Phase-3 (INR156bn), Kalai-II Hydro Electric