Amid the recent market meltdown, the BSE capital goods index is down 13 percent from its 52- week and its all-time high levels. The index represents companies from sectors which are directly linked to economic growth, and are cyclical in nature.
Over the past decade, especially post-Covid, the government’s thrust on capital spending has augured well for the capital goods and ancillary industries involved in the creation of infrastructure — such as power, roads, railways, ports, airports, industrial plants, oil rigs, logistics, mass transport, etc. The effect of this was reflected in the financials and stock market performance of capital goods companies.
