The investment-related stimulus announced by the Central government since March 2020 and the liberal Monitory Policy adopted by the RBI in FY21 have indeed led to a faster recovery in the projects investment activities in the country. Though we are far away from the high growth seen in projects investment in FY19, the investment trends of the last two quarters do indicate that the journey towards normalcy has begun. Not for nothing, the IMF recently increased the projected GDP growth of the country from 11.5 percent to 12.5 percent in FY22.

The fourth quarter of FY21 saw announcement of 2,647 new projects with a total investment intention of Rs 3,93,464.66 crore as against 2,210 new projects worth Rs 2,94,978.97 crore in Q3/FY21 indicating a Q-o-Q growth of 33.4 percent.

Manufacturing sector attracted 518 new projects entailing a total projex of Rs 1,11,458.89 crore in Q4/FY21. Of this, 12 were mega projects promising to bring in investment of Rs 74,999 crore. In the preceding quarter, 506 new projects worth Rs 79,285.4 crore were announced comprising 11 mega projects of Rs 49,975 crore. Within the Manufacturing sector, sub-sectors like Industrial Alcohols, Drugs & Pharma, Paints, Steel, Cement, Electronics, etc attracted a good amount of fresh investment intentions.

Among the sub-sectors, Drugs and Pharma was one of the stellar performer in FY21. Following the outbreak of COVID-19, we expected increased investment in this sector in FY21. Echoing our expectation, the sector attracted 468 new projects worth Rs 22,894.72 crore in FY21.

Negating the dismal performance in Q3/FY21, the Electricity sector in Q4/FY21 saw announcement of 89 projects worth Rs 63,901 crore. Bulk of these investments was in the Non-conventional Solar and Wind power sectors.

Renewed investment activities by both the Central and state government agencies helped the Infrastructure sector to maintain its steady growth observed since Q2/FY21. In all, 1,918 new projects with an investment intention of Rs 1,91,327.85 crore were announced in this major sector in Q4/FY21.

Real Estate, Commercial Complexes and Industrial Parks together saw announcement of 479 new projects entailing a total investment of Rs 58,433.48 crore in Q4/FY21. This indicated a very healthy Q-o-Q growth of 47.41 percent. Of the three sub-segments, Real Estate saw fresh investment increasing from Rs 15,634.61 crore in Q3/FY21 to Rs 38,905.36 crore in Q4/FY21. On the downside, most of the developers, Projects Today contacted shared that most of their projects are facing a time-overrun of at least one year.

Mostly aided by Rs 50,000 crore integrated steel project of ArcelorMittal Nippon Steel India Odisha state managed to top the table of fresh investment in Q4/FY21. In all, the state attracted 107 new projects worth Rs 62,352.28 crore.

The second-ranked Maharashtra attracted 325 new projects worth Rs 40,902.06 crore, followed by Andhra Pradesh with 72 new projects worth Rs 39,610.92 crore.

Q4/FY21 also saw the return of government agencies to the projects investment arena after their dismal performance in Q3/FY21. Private sector continued its good performance of Q3 in Q4 too.

Q3/FY21 had seen a steep fall in government investment in the form of fresh investment and such investment declined by 11.29 percent. However, on a refreshing note, both Central and state government agencies reversed the declining trend and announced 1,728 new projects worth Rs 1,67,251.22 crore and registered a growth of 21.8 percent on Q-o-Q basis.

On top of 770 new projects worth Rs 1,57,667.43 crore in Q3/FY21, the private sector announced 919 new projects worth Rs 2,26,213.44 crore in Q4/FY21 and recorded a growth of 43.48 percent.

The heightened performance in the last quarter of the fiscal 2020-21 helped to limit the year-on-year decline in fresh investment to just -1.23 percent. During fiscal 2020-21 in all 8,551 new projects worth Rs 10,72,330.36 crore were announced as against 9,307 projects worth Rs 10,85,731.33 crore in FY20.

In terms of the number of new projects, Gujarat stood second with 312 new projects worth Rs 20,334.12 crore. Of this, 204 projects were from private project promoters.

Odisha, Andhra Pradesh and Karnataka were the three states to corner around half of the total fresh projex announced by the Private sector in Q4/FY21.

The projex funnel (outstanding projects investment) increased by 6.20 percent during FY21. As of 31 March 2021, there were 78,271 projects entailing a total investment of Rs 1,64,37,923 crore (USD 2.22 trillion) in various stages of implementation. Of this, 17,709 projects with a total projex exposure of Rs 61,87,368 crore (USD 835 billion) were under execution, indicating a project execution ratio of 37.64 percent.