Post-Covid boom in profits yet to show in India Inc capital expenditure

Corporate profits have grown at a CAGR of 32.4% since FY20 but firms' net fixed assets have grown at 8.6% CAGR in FY20-24

The last four years, the best for corporate profits in a long time, have not been as impressive for corporate capital expenditure.

The combined net profits of India’s top listed companies excluding banks, financial services, and insurance (BFSI) increased at a compound annual growth rate (CAGR) of 32.4 per cent since FY20, a sharp jump from the 7.4 per cent in corporate earnings between FY14 and FY19.

However, this didn’t translate into corresponding growth in corporate investment in fixed assets such as plant and machinery.

The combined net fixed assets including capital work in progress of the non-BFSI companies in