This comes after a decade of structural deleveraging that has left corporate balance sheets clean and highly profitable.
Banks are positioned to be the primary beneficiaries of the coming investment cycle as they could potentially capture Rs 99.50 lakh crore over the next 5 years, OmniScience Capital said in its report.
Based on RBI’s FY2024 corporate credit stock, this implies 16 pr cent compounded annual growth (CAGR) potential, compared with near-stagnation over the last decade.
According to the report, with corporate balance sheets clean, profitability at multi-year highs, and asset utilization rebounding, the report concludes that India Inc. is fundamentally ready for its next major investment cycle.
This dual recovery — healthy borrowers and healthy, well-capitalised lenders — has created a powerful, long-term investment opportunity.
The report noted that banks are set to evolve from simple supporters of the economy to the strategic drivers and primary beneficiaries of India's next wave of capital expenditure and growth.
Meanwhile, private sector capex will be complemented by a massive government infrastructure push by the Centre and top states projected at Rs 96 lakh crore over the next five years.
Credit growth will be supported by sustained consumer demand, driven by a combination of a rationalised GST structure, income tax cuts and the monetary policy easing cycle, which is likely to push capacity utilisation above the 75–80 per cent threshold and trigger widespread private capex, the report highlighted.
Already the world’s fourth largest economy, the nation is charting a confident course towards becoming the third largest one by 2030 -- with GDP projected at $7.3 trillion. India’s economic ascent continues to capture global attention and the current growth phase reflects the strength of decisive policymaking, structural reforms, and India’s deepening global integration, according to the government.
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