The aggregate envisaged capex for 2019-20 will also depend on the level of corporate investment, including fresh projects sanctioned during the year.

With a 42% rise in the planned capital expenditure for 2019-20 by the private corporate sector, the beginning of a turnaround in the investment cycle is likely, said an article published by the Reserve Bank of India (RBI). The planned capex is estimated to rise to Rs 1.2 lakh crore in 2019-20, up 42% from Rs 84,602 crore in the previous year.

“The planned or envisaged capex from all sources based on the pipeline projects sanctioned in all preceding years points to a noticeable improvement in 2019-20. The investment cycle appears to be poised to gain momentum in the short to medium term, but its sustainability needs to be watched closely,” the article said. The aggregate envisaged capex for 2019-20 will also depend on the level of corporate investment, including fresh projects sanctioned during the year.

To gauge investment intentions, the study primarily sourced data from financiers of capex projects, including banking sector and financial institutions; external commercial borrowings; foreign currency convertible bonds; rupee-denominated bonds; initial public offerings; follow-on public offerings and rights issues for a year.

Projects not financed through these channels or of a size lower than Rs 10 crore were not covered in the study.

During H1FY20, the number of projects came down while the amount sanctioned went up compared to the year-ago period. A total of 423 projects were sanctioned Rs 1.87 lakh crore through various channels. The share of ECBs in financing saw an increase to Rs 61,833 crore, compared with Rs 39,833 crore in the year-ago period. In H1FY19, the number of projects was 485 while the sanctioned cost stood at Rs 1.27 lakh crore.

The total cost of projects sanctioned through various channels of financing increased to Rs 2.53 lakh crore in 2018-19, against Rs 2.07 lakh crore in 2017-18.