Capital expenditure crucial as inflation may hit India Inc plans: Icra

The current geopolitical conditions and the resultant spike in commodity prices could impact profitability of corporates, imparting some caution in the private sector capital expenditure and investment plans in the medium-term, ratings agency Icra said on Thursday. This means that capex plans of central and state governments will continue to be crucial.

Icra said it expected capacity utilisation to reach the critical threshold of 75 per cent required to trigger broad-based capacity expansion, only by the end of the current calendar year. “While some green shoots are visible in private investments, protracted geopolitical tensions and elevated commodity prices could constrain the