India government capex surges 19% in April-May, lifting cement sector outlook

Accelerating public spending in the first two months of FY27 signals a recovery in infrastructure demand, offering a tailwind for cement producers after a subdued period.

By Handelsavisen Newsroom · Automated 2026-07-20 08:31 UTC · 1 min read

Government capital expenditure across India’s central, state, and public sector enterprises rose 19% year-on-year in April and May 2026, marking a notable acceleration in public spending at the start of the new fiscal year.

The uptick in infrastructure investment is being viewed as a positive signal for the cement sector, which had faced subdued demand conditions during fiscal 2025 and 2026.

This development follows recent earnings reports from key industry players, including Nuvoco Vistas Corp, which posted a 20% year-on-year increase in consolidated net profit for the first quarter of fiscal 2027.

Analysts at Nuvama highlighted that the improved capex trajectory raises expectations for stronger cement consumption in FY27, despite potential mix headwinds.

This development follows recent earnings reports from key industry players, including Nuvoco Vistas Corp, which posted a 20% year-on-year increase in consolidated net profit for the first quarter of fiscal 2027.

The combination of improving corporate profitability and accelerating government spending suggests a potential inflection point for the sector.

Investors will be monitoring subsequent monthly capex data to confirm whether this early-year momentum sustains through the remainder of the fiscal year.