Infra and Capex in Samvat 2083: What the Next 12 Months of Government Spending Could Mean for Infrastructure Stocks
- November 5, 2026
- Posted by: Chaitanya Auti
- Category: Market
FY27 central capex budget: Rs 12.22 trn, up 11.5%. Effective capex: Rs 17.15 trn. Apr-Aug spend: Rs 5.10 trn (42%). L&T Q2 order inflow: Rs 1.48 lakh crore.
Quick Answer
Government capex is budgeted at a record Rs 12.22 trillion for FY27, up 11.5% from the previous year, and it is running ahead of schedule. The Centre spent Rs 5.10 trillion, or about 42% of the target, in April to August 2026, up 18% year on year, though August alone fell 30%. For infrastructure stocks, the next 12 months depend on whether spending stays on track and whether order wins, like L&T's record Rs 1.48 lakh crore quarter, turn into revenue and margins.
Government capex is set at a record Rs 12.22 trillion for FY27, and how it is spent over the next 12 months will shape the outlook for infrastructure and capital goods stocks in Samvat 2083. The Union Budget raised central capital spending by 11.5% from the FY26 revised estimate of Rs 10.96 trillion. Including grants to states for capital assets, effective capex is projected at Rs 17.15 trillion, up 22.1%.
This article covers where government capex is going, how spending is tracking so far, what company order books show and what investors should watch through the year.
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How Much Is the Government Spending on Capex in FY27?
The government is spending about Rs 12.22 trillion on capex in FY27, equal to about 3.1% of GDP. The budget also set aside Rs 1.85 trillion in interest-free capex loans to states and pegged capex by public sector enterprises at Rs 10.19 trillion. Defence allocation rose about 21% from the previous budget estimate.
| Item | FY27 Budget figure |
|---|---|
| Central government capex | Rs 12.22 trillion (+11.5%) |
| Effective capex (incl. grants for assets) | Rs 17.15 trillion (+22.1%) |
| Capex loans to states | Rs 1.85 trillion |
| Public sector enterprise capex | Rs 10.19 trillion |
| Capex as share of GDP | About 3.1% |
Source: Union Budget 2026-27, as reported by Informist and Business Standard.
Is Government Capex Running on Schedule?
Government capex is running ahead of schedule for the year, though monthly spending is uneven. The Centre spent Rs 5.10 trillion in April to August 2026, about 42% of the annual target, and spending in that period was 18% higher than a year earlier, according to Controller General of Accounts data cited by Jefferies.
August itself saw a 30% year-on-year fall, and Jefferies estimated that capex needs to grow about 12% in the remaining months to meet the target. Public sector enterprises were on track too: 63 CPSEs spent about Rs 4.30 trillion in April to September, around 51% of their FY27 target and nearly 12% higher than a year earlier.
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What Order Books Say About Infrastructure Stocks
Order books show government capex and private demand reaching the companies that execute projects. Larsen & Toubro reported a record quarterly order inflow of Rs 1,47,665 crore in Q2 FY27, up 28% year on year, and a consolidated order book of Rs 8,53,514 crore as of 30 September 2026. Its net profit rose 33% to Rs 5,202 crore and revenue grew 16% to Rs 78,750 crore.
The detail matters for investors. About 54% of L&T’s order book is international, and PL Capital noted its EBITDA margin fell 130 basis points year on year to 8.7%. So a large order book does not automatically mean higher profit margins, and execution and cost control decide how much of it reaches earnings.
How Did Capex-Linked Stocks Perform in Samvat 2082?
Capex-linked sectors held up better than the broader market in Samvat 2082. Business Standard reported that capital goods, PSU bank and metal indices gained between 6% and 22% in the year, extending a positive run to six straight Samvat years, while the Nifty 50 fell about 7.4%. The BSE PSU index is another useful gauge, since many capex beneficiaries are state-owned.
What to Watch in the Next 12 Months
- Monthly CGA data: a run of weak months for government capex like August would raise doubts about meeting the Rs 12.22 trillion target.
- Fiscal pressure: high crude prices and fuel subsidies could squeeze room for capex if revenue weakens.
- Order inflows vs execution: watch whether record orders turn into revenue at stable margins.
- Defence and railways: these are among the strongest spending areas and tend to drive order flows for PSU suppliers.
- Budget 2027-28: the February 2027 Budget will set the capex path for the second half of Samvat 2083.
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Risks for Infra and Capex Stocks
The key risks are slower government capex, rising interest costs and high valuations. The RBI raised the repo rate to 5.50% in October 2026, which raises borrowing costs for capital-heavy companies. Many capex stocks have rallied for several years, so any slip in orders or margins could hit prices hard. Payment delays from government clients are another risk to cash flows.
Conclusion
Government capex is set at a record level for FY27 and is running ahead of schedule, which supports the infrastructure theme in Samvat 2083. Order books such as L&T’s show the demand is real, but margins and execution decide stock returns. Track monthly spending data and quarterly order inflows rather than the budget headline alone.
Disclaimer: Data and figures in this article are sourced from publicly available information. These may or may not be accurate. Please verify all data with the official NSE (nseindia.com) and BSE (bseindia.com) websites before making any investment decision. Investments in securities are subject to market risk. Past performance does not indicate future returns, and illustrative figures are not guaranteed. This content is for educational purposes only and is not investment advice by Univest (SEBI RA INH000013776).
Frequently Asked Questions
What is the government capex budget for FY27?
Ans. The government capex budget for FY27 is Rs 12.22 trillion, up 11.5% from the FY26 revised estimate of Rs 10.96 trillion. Including grants to states for creating capital assets, effective capex is about Rs 17.15 trillion. Capex is about 3.1% of GDP, according to Union Budget 2026-27 figures.
How much capex has the government spent so far in FY27?
Ans. The central government spent about Rs 5.10 trillion on capex in April to August 2026, around 42% of the FY27 target, according to CGA data cited by Jefferies. Spending was up 18% year on year in that period. August alone fell 30% year on year, so monthly spending is uneven.
Which sectors benefit from government capex?
Ans. Government capex mainly benefits construction and engineering companies, capital goods makers, cement and steel producers, railway and defence suppliers, and power transmission firms. Lenders to infrastructure projects can also benefit. The impact on each company depends on its order wins, execution and margins.
What does L&T's order book say about capex?
Ans. L&T reported a record quarterly order inflow of Rs 1,47,665 crore in Q2 FY27, up 28% year on year, and an order book of Rs 8,53,514 crore as of 30 September 2026. About 54% of the order book is international. Its EBITDA margin fell to 8.7%, showing that strong orders do not guarantee higher margins.
Are infrastructure stocks a good investment in Samvat 2083?
Ans. Infrastructure stocks have government spending and strong order books behind them, but they also face higher interest rates and high valuations after several years of gains. Whether they suit you depends on valuation, execution track record and your goals. Treat this as a theme to research, not a recommendation.
What are the risks to the capex theme?
Ans. The main risks are a slowdown in government spending, fiscal pressure from high crude prices, rising interest costs after the RBI hike, payment delays from government clients and margin pressure on contractors. A weak month in CGA data or a cut in the next Budget could also weigh on the theme.
How did capex stocks perform in Samvat 2082?
Ans. Capex-linked sectors outperformed the broader market in Samvat 2082. Business Standard reported that capital goods, PSU bank and metal indices rose between 6% and 22%, while the Nifty 50 fell about 7.4% from Muhurat 2025 to 4 November 2026. This extended their positive run to six straight Samvat years.