Budget 2024 - The Ringside View Of Capex; Solar Glass, Rolling Stocks Get Their Due: ICICI Securities

ICICI Securities Report

Union Budget FY25 did not ring in any surprises, contrary to expectations. It was business as usual vis a vis Interim Budget. Total capital expenditure was pegged at Rs 11 trillion for FY25, a growth of 16% YoY.

The expenditure on roads and railways was flat while defence was up 9% YoY. To construct additional roads, the government is looking for more private investments.

On railways, the shift is towards higher spending on rolling stock and signalling. Power, renewables and water also found themselves mentioned in the budget. In case of power and renewables, the capex is driven by private sector, while for water, it is driven by the state.

Overall, we expect capital expenditure to be driven by private sector. Our top picks are NTPC Ltd., Bharat Heavy Electricals Ltd. and  GR Infraprojects Ltd.

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