ECONOMY
India’s old economy-led capex boom a hedge against global AI-driven euphoria
- IBJ Bureau
- Dec 14, 2025
India’s capital expenditure (capex) cycle is gaining strong momentum, driven largely by old-economy sectors. This old economy-led capex boom acts as a hedge against the global AI-driven investment euphoria, expected to peak in calendar year 2026 (CY26), according to a report by ICICI Securities.
The report notes that unlike the US, where a sharp rise in spending on IT equipment and software is now dominating private investment, India’s capex story continues to be broad-based and rooted in traditional sectors. It has added that this trend not only differentiates India from global patterns but also strengthens the country’s long-term investment outlook.
“India’s capex up-cycle is an AI hedge. Unlike the US, where capex growth is AI-led now, old-economy sectors are fuelling India’s capex growth; thereby, positioning India as a hedge against the AI euphoria in CY26,” the report underlines.
The report also highlights that utilities, energy, metals and industrials remain the biggest contributors to listed companies’ capex.
Utilities alone recorded capex of around Rs 1.98 lakh crore, followed by the energy sector at Rs 1.4 lakh crore and metals at Rs 1.1 lakh crore. Other segments such as healthcare, telecom, materials and cement are also adding meaningfully to the investment cycle.
The report adds that this wide participation from old-economy industries highlights India’s focus on building domestic capacity across critical areas such as energy transition, defence, rare earth processing, infrastructure, manufacturing, and digital public infrastructure.
Report By
View Reporter News