Capex increases from Indian Conglomerates- Market sentiment at all-time high
Reliance Industries Ltd (RIL), Tata group and the Aditya Birla group—India’s three biggest conglomerates—have announced new investments or capital expenditure adding up to almost Rs.3 trillion over the next 3-4 years. The corporate spending had reduced during the economic slowdown in the last few years.
Others, like the Adani Group and Larsen and Toubro Ltd (L&T), have also indicated that they will make fresh investments in the equity and debt markets but haven’t provided details. The investments will fund RIL’s expansion in the petrochemicals, refining, retail and telecom segments. Tata group has outlined plans for investment of up to Rs. 65,000 crore by various group firms.
Many companies have started accumulating funds ahead of the execution of projects. Capital-intensive companies like Tata Steel Ltd and Tata Housing Development Co. Ltd have lined up investments of Rs.16,500 crore and Rs.3,000 crore, respectively. Tata Motors Ltd plans to invest Rs. 38,500 crore, Tata Communications Ltd Rs.1,800 crore and Tata Consultancy Services Ltd Rs.4, 000 crore in the current fiscal.
The Aditya Birla group’s telecom arm Idea Cellular Ltd is not far behind and has announced that it would invest up to Rs.3, 500 crore in this fiscal year to build its network and launch 3G telecom services in Delhi next year.
The companies are not only investing to enhance their networks or capacities, companies like UltraTech Cement Ltd, India’s largest cement producer, have been adding capacity aggressively through acquisitions. This inorganic growth has given an edge to the company over its competitors.
Source- Mint
Adani Group, Adani Group announced their Rs 4400-crore acquisition, Aditya Birla Group, Larsen and Toubro Ltd, projects by Tata Group, Reliance Industries Ltd, Tata Group, Tata Group Real estate
