October 2025

Consumption First;

Private Capex Next?

Radhika Piplani

Radhika.Piplani@motilaloswal.com

Tanisha Ladha

Tanisha.Ladha@motilaloswal.com

Investors are advised to refer to important disclosures made at the last page of the Research Report

October 2025

Executive Summary



Over the past few months, India has faced multiple headwinds, primarily driven by geopolitics and wars, resulting in FII outflows of

USD9b between Jul and Sep’25. Domestically, urban consumption was relatively muted due to high interest rates, low liquidity, and

lower growth in the IT and banking sectors. To counter the weakening demand, the RBI cut policy rates by 100bp to 5.5%, reduced

the CRR rate by 150bp to accelerate rate transmission, and added systemic liquidity of nearly INR9t in the banking system through

daily and permanent operations, including FX swaps, OMOs, CRR cut, VRR/VRRRs. Moreover, the government frontloaded capex

spending and reduced income and GST tax rates. While it is still early to assess the full impact of this monetary and fiscal push,

early indicators appear to be positive. Auto retail sales surged to a record high toward the end of Sep’25. Vehicle registrations rose

34% to 1.16m units, driven by significant growth across PVs, 2Ws, CVs, and tractors.



We believe this marks the beginning of a turnaround in India’s domestic growth momentum, despite ongoing external sector risks.

We expect domestic consumption to pick up significantly in 3QFY26, paving the way for a robust revival in the private capex cycle.



Private capex complements consumption, albeit with a lag of two quarters. We observe that sectors like Power T&D, Coal, Telecom,

Oil & Gas, Ports, Cement, Airlines, Defense, and Electronics are already expanding capacities, positioning themselves to seize

opportunities in the next phase of growth. These core sectors, in our view, are driven not by cyclicality but by the structural changes

unfolding in aspirational India.



It is important to note that this leg of growth is NOT funded by banking credit. Instead, it is supported by external funding, IPOs,

QIPs, and, more importantly, corporate debt.



With the RBI’s October policy easing regulatory measures for banks and NBFCs, credit flow within the system is expected to

accelerate, potentially driving further increases in planned capital spending.



To identify a trackable indicator, monitor high-frequency auto registrations, sales figures, and dealer channel checks.

2

October 2025

Overview

India’s growth outlook has improved, supported by domestic monetary, regulatory, and fiscal policy levers:

1. The RBI has raised its FY26 GDP forecast to 6.8% from 6.5% in its October policy. We believe FY26 GDP could reach 7%

if US tariff

rates are reduced to at least 25% from the current 50% by November.



Real GDP growth for 1QFY26: 7.8% (130bp higher than the RBI estimate; 100bp higher than the market consensus). 2QFY26 could

also positively surprise the markets, supported by a favorable base and low deflator.



Note that the strong growth in 1Q and 2Q is driven by more than just a low base and subdued deflator. Services

(defense/government spending, BFSI, realty, travel, tourism) and agriculture & allied activities (rural consumption) were two

strong domestic pillars of growth in 1QFY26. 2QFY26 is expected to be supported by a favorable monsoon, government spending,

and frontloading of exports to the US. However, the impact of the 50% US tariffs will likely begin to slow exports from 3QFY26.



We concur that

nominal GDP growth

slowed to 8.8% in 1QFY26 vs. 10.8% in 4QFY25 as the GDP deflator eased to 0.9% YoY from

3.1% in 4QFY25. This deflator issue is expected to continue through FY26, with both CPI and WPI being low. Consequently, the

disparity between GDP data and weak high-frequency indicators (auto sales, diesel consumption, IIP, exports) is likely to continue.

Our

nominal GDP estimate for FY26 stands at 9%.

2.

Center capex + state capex

= INR6.6t in 5MFYTD26.

In 5MFYTD, the center’s capex grew by a strong 43% YoY to INR4.3t (38.5% of BE). For the 20 states analyzed, capex increased 10.1%

YoY to INR2.2t (21.6% of BE). Although state capex is progressing slower than the center’s (likely due to recent procurement

digitalization changes under the GFR 2025 rules), it is expected to pick up momentum soon.

3. Major tax overhauls:

a) GST reform (Sep’25); b) income tax cut (Feb’25).

3

October 2025

Engines of growth within private capex

Two engines of policy easing:

1. Monetary policy push and regulatory changes: CRR cut by 150bp and repo cut by 100bp (expect further 50bp); surplus liquidity

averaging INR2.5t on a daily basis in 2QFY26; FX swaps and OMOs; risk weight reductions on lending by banks to MSMEs/real

estate/NBFCs; domestic banks to fund M&As by Indian corporates; regulatory easing for NBFCs (especially reduced risk weights

for infrastructure lending); changes in the ECL framework for banks; LAS (loans against shares) for banks; and higher IPO

funding limits for banks.

2. Fiscal push: Income tax; GST rejig; frontloaded capex spend; support packages for MSMEs (including a potential increase in

credit guarantee limits for MSMEs impacted by trade tariffs); 3% DA increase for government employees under the 7th pay

commission starting from Jul’25; and upcoming 8th pay commission hike effective Jan’26.



Private capex complements consumption, albeit with a lag. Businesses typically invest only after observing clear signs of demand

pickup. Assuming domestic demand begins to rise significantly from 2HFY26, capex is expected to follow with a lag of two quarters.

With policy reforms currently focused on boosting consumption, the next phase of recovery is likely to emerge from private capex

activity.



India’s current capex/GDP ratio stands at ~30%, below the 2004-08 peak of ~35%. The investment outlook for private players

remains muted (geopolitics, export slowdown, and demand uncertainty).



We have identified sectors driven by structural drivers -

Power T&D, Coal, Telecom, Oil & Gas, Ports, Cement, Airlines, Defense,

Electronics.



To assess private capex sectoral opportunities, we have analyzed FY26 capex guidance from NSE 500 companies, management

commentaries, financial data from banks, ECBs, and corporate debt to validate sector-wise investment momentum.

4

October 2025

Insights on private capex

As a precursor to our detailed analysis, here are some significant takeaways :



Fact:

India is targeting sustained real GDP growth of 7-8%.

Insight:

Core sectors like metals, cement, coal, and power are already expanding capacity in anticipation of future demand.



Fact:

The top five sectors (Oil & Gas, Coal, Power, Auto, Telecom) drive 80% of private capex.

Insight:

Auto sector weakness is a key drag on capex; reviving demand in this segment could boost overall capex.



Fact:

Power utilities and transmission & distribution (T&D) networks are set for large-scale capacity upgrades.



Insight:

The power sector benefits from both healthy corporate balance sheets and strong bank credit support. The power sector

within infra received 40% of the total credit sanctioned by banks/FI in FY25. This trend has continued into FY26.



Fact:

Corporate balance sheets are strong.

Insight:

Sectors that are undertaking capacity expansions also have strong B/S. Hence, fewer corporations are seeking bank credit.

Industrial credit growth slowed to 5.9% in FYTD26 vs 8.9% in FYTD25, but sectors like electronics, power, and metals continue to

see healthy credit demand.



Fact:

ECBs were a preferred capital-raising route last year.

Insight:

Sectors that benefited include data centers, renewables, chemicals, and electronics.



Fact:

The highest IPO proceeds were raised in 2024.

Insight:

IPO activity remains strong this year in electronics, power, engineering, and IT despite global uncertainty.



Fact:

The corporate debt market is gaining traction.

Insight:

Gross corporate debt issuance exceeded repayments in 2Y, possibly highlighting bond issuance as an alternate source for

capex funding.

5

October 2025

Two sectors contribute 50% to India’s private capex – Power & Utilities

Capex by sectors (INR b)

Capex by Sectors (INR b)

Oil, Gas & Consumable Fuels

Power

Metals & Mining

Telecommunication

Auto & Ancillaries (excl. Tata Motors)

Cement & Cement Products

Healthcare

Chemicals

Capital Goods

IT

FMCG

Services

Civil Construction

Consumer Services

Consumer Durables

Residential, Commercial Projects

Textiles

Media, Entertainment & Publication

Paper & Paper Products

Total

Average Capex

(2011-20)

1,245

512

549

323

202

74

127

56

73

91

62

80

90

16

22

19

12

9

5

3,568

Average

Capex

(2022-25)

2,475

582

830

470

347

231

206

125

113

101

89

80

62

53

47

35

16

13

1

5,875

Consensus

Estimate

2026

2,829

1,252

1,055

681

413

370

229

159

181

173

98

248

78

85

52

99

27

13

0

8,042

Avg Share

(2011-20)

34.9%

14.4%

15.4%

9.1%

5.7%

2.1%

3.6%

1.6%

2.1%

2.6%

1.8%

2.2%

2.5%

0.4%

0.6%

0.5%

0.3%

0.3%

0.1%

Avg Share

(2022-25)

42.1%

9.9%

14.1%

8.0%

5.9%

3.9%

3.5%

2.1%

1.9%

1.7%

1.5%

1.4%

1.1%

0.9%

0.8%

0.6%

0.3%

0.2%

0%

FY26

share

35.2%

15.6%

13.1%

8.5%

5.1%

4.6%

2.8%

2.0%

2.2%

2.2%

1.2%

3.1%

1.0%

1.1%

0.7%

1.2%

0.3%

0.2%

0%

Growth

(2026

over

2022-25)

14

115

27

45

19

60

11

27

61

71

9

212

26

61

11

185

71

(0)

(76)

37

Incremental

contribution

to growth

2022-25

53.3

3.0

12.2

6.3

6.3

6.8

3.4

3.0

1.7

0.4

1.2

(0.0)

(1.2)

1.6

1.1

0.7

0.2

0.2

(0.2)

100

Growth Incremental

(2026 contribution

over

to growth

2025)

2026

(0)

16.3

51

30.9

(-5)

10.4

17

9.8

(7)

3.0

23

6.4

(10)

1.1

23

1.5

18

3.0

59

3.3

(4)

0.4

154

7.8

23

0.7

16

1.5

(3)

0.2

143

3.0

35

0.5

34

(0.0)

(88)

(0.0)

12

100

Source: NSE, MOFSL

6

October 2025

Emerging sectors for capex: ECom, Diversified Retail, Hotels

Delta shift in capex: Traditional vs emerging sectors (2011–20 vs 2022–25)

Consumer Services

Cement & Cement Products

Chemicals

Consumer Durables

Oil, Gas & Consumable Fuels

Residential, Commercial Projects

Healthcare

Media, Entertainment & Publication

Capital Goods

Telecommunication

Metals & Mining

Fast Moving Consumer Goods

Textiles

Automobile and Auto Components

Information Technology

Power

Services

Civil Construction

Paper & Paper Products

(100)%

(50)%

0%

50%

100%

Source: CEIC, MOFSL Research

7

October 2025

Power, Utilities, Oil & Gas, Ports, Airlines to lead capex growth



According to street consensus, FY26 NSE 500 capex is expected to grow 11.6% YoY to INR8.0t (FY25: INR7.2t). Focusing on core

sectors with structural drivers, growth is expected at 23%, reaching INR6.3t (FY25: INR5.1t).



Sectors contributing the most to private capex include oil & gas, coal, power T&D, telecom, and auto.



We have divided sectors into four quadrants based on the size of their capital spending.

Big sectors, big capex – INR4.0t (20% YoY)



Power Generation/Utilities/ T&D



Coal



Telecom



Oil & Gas



Auto

Small sectors, big capex – INR0.5t (52% YoY)



Defense



Cap goods



Carbon black



Pesticides



Agrochemicals



Fertilizers



Speciality

chemicals



Textiles



Zinc



Ecom



Industrial Minerals



Realty &

Data Centre



Civil Construction

Big sectors, small capex – INR1.8t (24% YoY)

Small sectors, small capex



Cables



Retail



Restaurants



Hotels



Footwear

8



FMCG



Sugar



Logistics



Media



Aluminum



Cement



Airlines



Ports



Pharma/Hospitals



Iron & Steel



Aluminium



IT

October 2025

Big sectors, big capex: Power, Coal, Auto

Power Generation/Utilities/T&D



These sectors are witnessing increased T&D spending across India. Capex is rising across renewables/hydro/offshore wind/thermal

power (JSW, NTPC, Adani Power, Tata Power).



Generation & Utilities (JSW Energy, BHEL, Torrent Power):

Capex is expected to grow 70% YoY to INR1.3t



Transmission & Distribution (T&D) (PGCL, Apar Industries, GE Vernova):

Capex is expected to rise 155% YoY to INR0.2t

Coal India:

The company is leading the sector with 40% capex growth (INR0.2t). FY25 saw subdued growth. The company is expanding

capacities in FY26 by re-opening 32 defunct mines, launching up to five new opencast mines through PPP, and issuing tenders to

construct 5 GW of renewable capacity—3 GW solar and 2 GW wind.

Telecom



Maintenance capex remains the focus. With FPO funds exhausted, Vi is relying on internal cash and non-bank financing to drive its

capital expenditure, especially amid unresolved AGR issues (a bank raise is in process, but nothing has been confirmed yet).

Meanwhile, Airtel continues to prioritize maintenance capex following the completion of its 5G rollout. It is also allocating capital

toward data center investments.



The total sector capex is expected to rise ~INR100b in FY26 to INR0.7t (Vodafone: +73% YoY (INR73bn);

Airtel:

+9% YoY (INR32b)).

Oil & gas



The sector anticipates aggressive capacity expansion, driven by higher demand (green energy, crude oil, NG demand to double by

2040) (Oil India, GAIL).



Capex is expected to rise 14% to INR1.5t (excl. RIL, CIL) (GAIL, Gujarat State Petronet, IGL, BPCL, HPCL, Petronet LNG Ltd).

Auto & Auto Ancillaries

(ex-Tata Motors): OEM capex growth remains flat; capex of tire companies is likely to grow 38% to INR70b.



Tire companies (replacement segment: Apollo: +98% YoY; JK: +45%), EVs and tractor segments are witnessing capex growth.

Larger segments like CV and PV are witnessing a slowdown. OEMs’ capex is expected to pick up after the rundown of inventory.

The sector stands to benefit significantly from the GST cut.

9

October 2025

Big sectors, small capex: Cement, Airlines, Ports

Cement



Healthy expansion by all companies in anticipation of strong demand in the next 2-3 years; cash-rich B/S (more equity, less debt)



Capex to rise 25% to INR0.3t (Ambuja, UT)

Airlines

(InterGlobe Aviation): Sharp increase in capex to INR0.1t, focused on leasing aircraft and adding international routes

Ports



Expansion of port infra, acquisition of additional fleet, and growth in logistics business; over 300% surge in sector capex to INR0.1t



Adani Ports:

576% YoY (INR0.1t); ‘transforming company into integrated transport utility company… rail, terminals, ICDs,

warehouses, agri-logistics, and now trucking’ – Ashwani Gupta, CEO (Adani Ports)



JSW Infra:

154% to INR52b; Gujarat Pipavav: >200% YoY (INR3b)

Aluminum/iron and steel



Maintenance capex continues as aluminum realizations remain under pressure from Chinese exports and global surplus. Newer

segments, like Specialty Alumina, remain relatively small. Funding: Internal accruals (~80%) + debt



Capex to rise 7.3% to INR0.4t (Vedanta, Hindalco: US subsidiary Novelis led capex on aluminum recycling, National Aluminum Co.

Ltd)

IT



Maintenance capex across Tier-1, Tier-2 companies; tariff/global trade-led uncertainty remains a key risk, driving lower

headcounts



Only Coforge (IT) and Anant Raj (Realty) have announced data center-driven fresh capex; several unlisted players announcing

capex in this space

10

October 2025

Small sectors, big capex: Defense, Cap Goods, Agro/Specialty Chemicals (1/2)

Defense



Sharp increase in orders within India as well as outside (drones, aircraft, explosives)



95% YoY capex growth to

INR64b

(Hal; Zen Technologies); Industrial & Defense Explosives – 140% YoY to INR24b (Solar Industries)

Cap goods



Mixed capex performance.

Companies entering newer segments; traditional segments stagnant. Strong sub-segment growth in

castings & forging (AIA Eng.),

Electrodes & Refractories (HEG),

heavy electrical equipment (Triveni Turbine), industrial products

(Honeywell automation)



18% YoY capex growth to INR41b

Civil construction



Afcons/ IRB-ECB; Kalpataru/KEC – Internal accruals



IRB Infra Developers (232% YoY), KNR Cons (317% YoY), KEC (83% YoY), NCC (109% YoY), PNC Infratech (178% YoY). (Note: RITES

capex at (-) 40% YoY; L&T: 0%)



Negative: Delayed payments in water projects; Positive: rise in renewable/hydro/wind projects



17% YoY capex growth to INR70b

Fertilizers/pesticides/agrochemicals



Domestic demand: Good. Global demand: Mixed (Africa, Middle East, South Asia performing well; US weak)



62% growth in capex to INR53b (UPL, Bayer CropScience, Chambal, Coromandel)

Specialty chemicals



Robust demand led by expansion in agrochemicals, pharma, and fluorochemicals



19% capex growth to INR44b (SRF - announced two new projects of INR7.4b for agrochem in Dahej and Indore)

11

October 2025

Small sectors, big capex: ECom, Realty, Zinc, Industrial Minerals, Carbon Black (2/2)

Industrial minerals



Major capex allocated toward slurry pipeline and digital mining (IoT/Drone-based)



57% YoY increase in capex to INR55b (NMDC, Gravita India, Gujarat Mineral Development)

Zinc



Restraint capacity expansion; steady zinc demand with higher production costs (exploring rare earth element opportunities)

Production lower due to lower ore grades in certain mines and global price volatilities; Funding: Internal accruals



Hindustan Zinc: 33% capex growth to INR57b

Textiles



Domestic: Weak, Global: Expectations of higher exports; Global uncertainty weighs; FTAs provide some support (UK-India FTA).



40% YoY capex to INR28b (KPR mill, Vardhman)

Ecommerce



Expansion in tier-2, tier-3 cities; warehouse building; Risk: Competition



>100% capex growth to INR13b (Eternal Ltd)

Carbon Black



(PCBL) INR35b capex is allocated across three initiatives over the next five years, expanding carbon black capacity to over 1MT and

doubling Aquapharm’s capacity and infusion in the new JV for nano silicon products. Global CB demand is expected to post a 3.6%

CAGR. The Indian tire industry is likely to clock 7-8%, positioned to capitalize on the EV battery market growth.



PCBL capex: 117% YoY to INR7b

Realty



Only a few companies are adding fresh capital; inventory is an issue for the remaining companies. The sector is likely to benefit the

most from interest rate cuts, fiscal push (income tax, GST rate cut), and easy liquidity.



84% capex growth to INR61b (DLF, Prestige Estates)

12

October 2025

Sectors announcing capex projects – Metals, Renewables, Power, Electronics



While companies typically begin the year with capex targets, they often face challenges in meeting them. Here, we examine capex

announcements across key sectors in FY25 and 1QFY26 to identify where actual investment activity is taking place.

Industry

Renewable electicity

Steel

Conventional electricity

Other Chemicals

Inorganic chemicals

Electronics

Passenger vehicles

Storage batteries

Commercial complexes

Value of new project announcements in FY25 (Rs bn)

5538

3013

2055

1402

1365

1129

635

502

362

Industry

Aluminium & aluminium products

Renewable electricity (Solar & Wind)

Air transport services (Indigo)

Conventional electricity (Power Storage)

Electronics (Solar Cells, PVC)

ITES (Data Centres)

Inorganic chemicals

Cement

Drugs & pharmaceuticals

Value of new project announcements in Q1FY26 (Rs bn)

1280

443

427

189

122

120

103

82

74

Misc manufactured articles (Aerospace, defence) 348

Source: CMIE, MOFSL Research

Source: CMIE, MOFSL Research



Newer sectors: Renewables, inorganic chemicals, infra (airports, ports), defense, data centers, semiconductors, green hydrogen,

EVs, energy storage (Tata, JSW, Adani, Reliance, etc)

13

October 2025

Banks lending money to Power, Renewable, Electronics, Airline



RBI’s sectoral credit data shows strong lending growth in Metals, Electronics, and Power. Through our corporate channel checks, we



have compared private sector capex plans/announcements with areas where banks are actively disbursing credit.

Objective:

To assess whether the market can support these capex plans and validate if private sector investment intentions align

with actual bank lending trends.

KEY SECTORS WHERE CREDIT OFFTAKE IS NOT TAKING PLACE

KEY SECTORS WHERE CREDIT OFFTAKE IS TAKING PLACE

















Power generation/distribution

Renewables (solar)

Electronics

Airline

Telecom (Vi)

Data centers

Metals (slower but ongoing growth)

Ports (deployment of capital raised is an issue)



FMCG (only organic capex taking place; not much borrowing





















from banks)

Diversified retail (Banks hesitate to lend)

Specialty chemicals (destocking still a challenge)

Auto

Pharma (very few players looking for capex)

Railways (only a few small players looking for capex; recent

government policy update a concern)

Textiles

Footwear

Housing (inventory buildup a concern)

Defense (banks forbidden to lend)

Cement (strong B/S; own financing)

14

October 2025

Sectors dependent on banks (monthly data highlights) – Metals, Electronics, Power

Services loans growth remained resilient:

11% YoY/10% FYTD



Within services –

trade/real estate/NBFCs:

strong growth

Personal loans growth remained stable:

11.8% YoY (Jul’25: 11.9%)



Within retail –

housing: tepid/ credit card: slowing /gold: strong



Vehicle

loan growth decelerating (lowest in three months), but

decent at 8.7% YoY

Industry leaders



Micro

(21% YoY/17% FTYD);

medium enterprises

(13% YoY),

large

enterprises

growth improved but still muted



Basic metal:

Modest 9% growth; followed by the

Engg segment

(20% YoY)



Power:

11% YoY/8% FYTD, decent for a large sector.



Petroleum:

Decelerated but still robust at 9% YoY/5% FYTD



Chemicals:

Improved to 7% YoY/6% FYTD, the highest growth in

five months

Industry laggards



Infra

continues to struggle with 2% YoY growth;

Telecom

witnessed a 17% YoY decline/20% FYTD;

Ports

declined 14%

YoY/15% FYTD;

Cement

growth improved slightly but still muted

at 0.7% YoY/-0.6% FYTD

Broad sectoral credit growth (%YoY)

35.0%

Agriculture

Industry

Services

Personal Loans

20.0%

5.0%

(10.0)%

Aug-11

Aug-13

Aug-15

Aug-17

Aug-19

Aug-21

Aug-23

Aug-25

Sub-sector-wise credit growth (%YoY)

Mining

Basic Metals

35.0%

20.0%

5.0%

Chemicals

Engineering

Cement

Infra

(10.0)%

(25.0)%

Aug-15

Aug-17

Aug-19

Aug-21

Aug-23

Aug-25

Source: CEIC, MOFSL

15

October 2025

Sector-wise ECB flows



There is a growing reliance on ECBs, IPOs, QIPs, and corporate debt. This slide focuses on sectors leveraging ECB funding to drive

modernization and capital expansion.

Sector

Services (Aviation)

Data Centers

Renewable Energy

Chemicals & Chemical Products

Electronic Products

Basic Metals

Infrastructure

Others

Source: RBI, MOFSL

Purpose of ECB funding over the past year

InterGlobe Aviation raised INR818m to expand its aircraft fleet

INR877m borrowed to build new data centers

New green energy projects by Adani Green & Tata Power Renewable

INR520m for modernization and new projects (SNF Limited, Mundra Petrochem)

Funding for smart metering and semiconductor manufacturing projects

For importing capital goods for manufacturing

Civil engineering firms (Afcons, IRB) using ECBs for new infrastructure projects

Scattered inflows in

cement, solar energy, and refractory materials

16

October 2025

Sector-wise IPO announcements – Electronics, Power



Electronics and power have the largest issue size in IPOs.

Sector-wise IPO size (INR b)

Despite global uncertainties, USD11.4b was raised in CYTD25 via IPO route

Sector-wise IPO issue size (Approved and Filed as of

June'25)

Electronics & Equipments

Power Generation and Supply

Engineering

139

301

98

74

60

59

57

47

47

38

36

34

Source: MOFSL Research

IT

Chemicals

Commercial Services & Supplies

Realty

Pharma/Drugs

Cement and Construction…

Food and Food Processing

Plastic Packaging

Mining and Metals

Source: MOFSL Research

17

October 2025

Net corporate debt issuance picks up



India’s gross corporate debt issuance at INR14t, as reported by listed players with over INR100m in market caps, has begun to



exceed repayments of INR13t over the past three years. This trend not only signals a positive outlook for private capex but also

highlights corporate debt as an active financing instrument over and above the traditional banking route and equity raises.

Looking at the breakdown of corporate debt by sectors over 1QFY26, the top five sectors—excluding financials and government—

were Utilities, Materials, Consumer Discretionary, Industrials, and Consumer Staples, totaling around INR750b.

Debt issuance has started exceeding repayment after a decade

(INR t)

16

Debt issued

Debt repaid

12

8

4

0

FY01 FY02 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25

Source: Bloomberg , MOFSL

18

October 2025

Consumer Discretionary, Utilities, and Materials gain from corporate debt pickup

Breakdown of corporate debt by sectors for 2QFY26

Quarterly corporate bond issuance volume (INR t)

Source: Bloomberg, MOFSL

19

October 2025

Motilal Oswal Financial Services Ltd

MEMBER OF BSE AND NSE

Motilal Oswal Tower, Sayani Road, Prabhadevi,

Mumbai 400 025, INDIA

BOARD: +91 22 3982 5500 |

WEBSITE:

www.motilaloswal.com

Explanation of Investment Rating

Investment Rating

Expected return (over 12-month)

BUY

>=15%

SELL

< - 10%

NEUTRAL

> - 10 % to 15%

UNDER REVIEW

Rating may undergo a change

NOT RATED

We have forward looking estimates for the stock but we refrain from assigning recommendation

*In case the recommendation given by the Research Analyst is inconsistent with the investment rating legend for a continuous period of 30 days, the Research Analyst shall within following 30 days take appropriate measures to make the recommendation

consistent with the investment rating legend.

Disclosures:

The following Disclosures are being made in compliance with the SEBI Research Analyst Regulations 2014 (herein after referred to as the Regulations).

Motilal Oswal Financial Services Ltd. (MOFSL) is a SEBI Registered Research Analyst having registration no. INH000000412 and BSE enlistment no. 5028. MOFSL, the Research Entity (RE) as defined in the Regulations, is engaged in the business of providing

Stock broking services, Depository participant services & distribution of various financial products. MOFSL is a listed public company, the details in respect of which are available on

www.motilaloswal.com.

MOFSL is registered with the Securities & Exchange

Board of India (SEBI) and is a registered Trading Member with National Stock Exchange of India Ltd. (NSE) and Bombay Stock Exchange Limited (BSE), Multi Commodity Exchange of India Limited (MCX) and National Commodity & Derivatives Exchange Limited

(NCDEX) for its stock broking activities & is Depository participant with Central Depository Services Limited (CDSL) National Securities Depository Limited (NSDL),NERL, COMRIS and CCRL and is member of Association of Mutual Funds of India (AMFI) for

distribution of financial products and Insurance Regulatory & Development Authority of India (IRDA) as Corporate Agent for insurance products and is a member of Association of Portfolio Managers in India (APMI) for distribution of PMS products. Details of

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Details of pending Enquiry Proceedings of Motilal Oswal Financial Services Limited are available on the website at

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subject company at the end of the month immediately preceding the date of publication of the Research Report or date of the public appearance. MOFSL and its associate company(ies), their directors and Research Analyst and their relatives may have any other

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MOFSL and it’s associates have not received any compensation or other benefits from the subject company or third party in connection with the research report.

Subject Company may have been a client of MOFSL or its associates during twelve months preceding the date of distribution of the research report. Research Analyst may have served as director/officer/employee in the subject company. MOFSL and research

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research report. Above disclosures include beneficial holdings lying in demat account of MOFSL which are opened for proprietary investments only. While calculating beneficial holdings, It does not consider demat accounts which are opened in name of MOFSL

for other purposes (i.e holding client securities, collaterals, error trades etc.). MOFSL also earns DP income from clients which are not considered in above disclosures.

To enhance transparency, MOFSL has incorporated a Disclosure of Interest Statement in this document. This should, however, not be treated as endorsement of the views expressed in the report. MOFSL and / or its affiliates do and seek to do business including

investment banking with companies covered in its research reports. As a result, the recipients of this report should be aware that MOFSL may have a potential conflict of interest that may affect the objectivity of this report.

20

October 2025

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This report has been prepared by MOFSL and is meant for sole use by the recipient and not for circulation. The report and information contained herein is strictly confidential and may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to

any other person or to the media or reproduced in any form, without prior written consent of MOFSL. The report is based on the facts, figures and information that are considered true, correct, reliable and accurate. The intent of this report is not recommendatory in

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instruments for the clients. Though disseminated to all the customers simultaneously, not all customers may receive this report at the same time. MOFSL will not treat recipients as customers by virtue of their receiving this report.

Analyst Certification.The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the research analyst(s) was, is, or will be directly or indirectly related to

the specific recommendations and views expressed by research analyst(s) in this report.

Disclosure of Interest Statement

Analyst ownership of the stock

No

A graph of daily closing prices of securities is available at

www.nseindia.com, www.bseindia.com.

Research Analyst views on Subject Company may vary based on Fundamental research and Technical Research. Proprietary trading desk of MOFSL or its associates

maintains arm’s length distance with Research Team as all the activities are segregated from MOFSL research activity and therefore it can have an independent view with regards to subject company for which Research Team have expressed their views.

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This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject MOFSL & its group

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This report is distributed in Hong Kong by Motilal Oswal capital Markets (Hong Kong) Private Limited, a licensed corporation (CE AYY-301) licensed and regulated by the Hong Kong Securities and Futures Commission (SFC) pursuant to the Securities and Futures

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The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S. registered broker-dealer, MOSIPL, and therefore, may not be

subject to NASD rule 2711 and NYSE Rule 472 restrictions on communication with a subject company, public appearances and trading securities held by a research analyst account.

For Singapore

In Singapore, this report is being distributed by Motilal Oswal Capital Markets (Singapore) Pte. Ltd. (“MOCMSPL”) (UEN 201129401Z), which is a holder of a capital markets services license and an exempt financial adviser in Singapore.This

report is distributed solely to persons who (a) qualify as “institutional investors” as defined in section 4A(1)(c) of the Securities and Futures Act of Singapore (“SFA”) or (b) are considered "accredited investors" as defined in section 2(1) of

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inform MOCMSPL .In respect of any matter arising from or in connection with the research you could contact the following representatives of MOCMSPL. In case of grievances for any of the services rendered by MOCMSPL write to

grievances@motilaloswal.com.

Nainesh Rajani

Email:

nainesh.rajani@motilaloswal.com

Contact: (+65) 8328 0276

21

October 2025

Disclaimer:

This report is intended for distribution to Retail Investors.

The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form,

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Statement incorporated in this document is provided solely to enhance the transparency and should not be treated as endorsement of the views expressed in the report. This information is subject to change without any prior notice. The Company reserves the right to

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principal or agent in or for the securities mentioned in this document. They may perform or seek to perform investment banking or other services for, or solicit investment banking or other business from, any company referred to in this report. Each of these entities

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eligible for sale in all jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to inform themselves of and to observe such restriction. Neither the Firm, not its directors, employees, agents or representatives

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Investment in securities market are subject to market risks. Read all the related documents carefully before investing.

Registration granted by SEBI, enlistment as RA with Exchange and certification from NISM in no way guarantee performance of the intermediary or provide any assurance of returns to investors

Registered Office Address: Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai-400025; Tel No.: 022 - 71934200 / 71934263; www.motilaloswal.com. Correspondence Address: Palm Spring Centre, 2nd Floor, Palm Court

Complex, New Link Road, Malad (West), Mumbai- 400 064. Tel No: 022 71881000. Details of Compliance Officer: Neeraj Agarwal, Email Id: na@motilaloswal.com, Contact No.:022-40548085.

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022 40548082

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Registration details of group entities.: Motilal Oswal Financial Services Ltd. (MOFSL): INZ000158836 (BSE/NSE/MCX/NCDEX); CDSL and NSDL: IN-DP-16-2015; Research Analyst: INH000000412, BSE enlistment no. 5028 . AMFI: ARN .: 146822. IRDA

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22

October 2025