A Bank of Baroda report highlights increasing capacity utilisation across India’s infrastructure-linked industries, driven by public spending and demand growth, signalling a potential surge in fresh investments over the coming years.
A Bank of Baroda Economic Research report says India’s infrastructure-linked industries are showing firmer capacity use and could draw more fresh investment if the trend continues. Electricals, capital goods and infrastructure were among the sectors with the strongest and most consistent improvement, alongside FMCG, logistics and agriculture, suggesting that existing assets are being used more intensively as demand holds up.
The report, which reviewed company balance sheets across industries, used gross sales divided by gross fixed assets as a stand-in for capacity utilisation. Bank of Baroda said the ratio for electricals rose from 3.49 in 2024 to 3.69 in 2025 and 3.84 in 2026, while infrastructure increased from 2.94 to 3.10 and then 3.13. Capital goods climbed from 2.74 to 2.84 and 2.93 over the same period, and FMCG improved from 2.00 to 2.16 and 2.25.
According to the report, the gains in electricals, capital goods and infrastructure were helped by heavy public spending, which has supported activity across those industries and lifted utilisation. In FMCG, the bank pointed to a pick-up in demand and the launch of new products, including premium offerings. Livemint reported separately that gross fixed assets across 1,393 companies in 122 industries rose to ₹28.50 trillion in FY25 from ₹26.49 trillion a year earlier, a 7.6% increase, with infrastructure-heavy sectors doing much of the work.
The report also said several sectors that had weakened in FY25 improved again in FY26, including automobiles and ancillaries, information technology, chemicals, non-ferrous metals, diversified companies and diamonds and jewellery. It said the move into data centres and artificial intelligence is raising investment needs in IT, while infrastructure activity is supporting chemicals and non-ferrous metals. At the same time, crude oil, telecom, iron and steel, and construction materials saw softer ratios, though Bank of Baroda cautioned that this does not automatically signal weaker investment in capital-intensive industries with long project cycles. Other reporting on the bank’s work said nearly 91% of central government investment in FY25 was concentrated in five sectors, and that almost 80% of fresh FY26 investment intentions were clustered in just five areas, underscoring how concentrated the current capex cycle remains.
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