Public sector banks have reported a combined corporate loan pipeline of about ₹7.8 lakh crore, signaling stronger credit demand as companies step up capital expenditure across sectors like renewable energy, steel, cement, battery storage, and data centres. But pipelines vary wildly in scale, composition, and risk. Here's what the numbers reveal about India's capex story.
State Bank of India (SBI) dominates with a corporate loan pipeline of around ₹5 lakh crore, dwarfing Punjab National Bank's (PNB) ₹1.58 lakh crore. This isn't just about size—it's about market positioning. SBI's corporate loans stood at ₹14.21 lakh crore at June 2026, up 18.05% year-on-year. Its pipeline, including undisbursed term loans and unutilised working capital, exceeds ₹9 lakh crore. SBI is actively processing large numbers of battery energy storage proposals and data centre cases, and it's building specialised expertise through its CHAKRA (Centre of Excellence for Sunrise Sectors) initiative to handle complex structures like mezzanine or equity funding. Investor Presentation +3
PNB, by contrast, is deliberately shedding low-yielding corporate advances (those yielding below 7%) and has exited about ₹34,000–40,000 crore of such loans in Q1 FY27 alone. Its corporate book is about ₹5.15–5.35 lakh crore, roughly 42–43% of domestic credit. PNB's strategy leans toward yield discipline and a retail/MSME shift rather than chasing large-ticket volume. The ₹1.58 lakh crore pipeline, with ₹2.5 lakh crore of sanctions in H1 FY27 against ₹4 lakh crore in all of FY26, indicates an acceleration in deployment but also a more selective approach. Transcript +3
Canara Bank's pipeline is about ₹47,000 crore, comprising roughly ₹30,000 crore of "hot leads" and ₹17,000 crore sanctioned but undisbursed. Indian Bank has identified opportunities worth ₹63,000 crore, though its latest disclosed pipeline was about ₹51,000 crore as of Q4 FY26. Central Bank of India reports a much smaller pipeline of ₹12,000 crore—₹7,000 crore sanctioned and ₹5,000 crore under process. Transcript +1
The variation comes down to balance-sheet size and strategic focus. Central Bank's corporate book is about ₹1.18 lakh crore, or 32% of loans, and its 42.05% corporate growth is largely a low-base effect. Management says it's "not an outlier" and guides to roughly 3% quarter-on-quarter credit growth going forward. Canara and Indian Bank are more active in green energy, battery storage, power evacuation, and data centres, with Canara's management saying it has "no dearth of good leads and proposals". Transcript +4
RBL Bank's corporate loans grew about 58% year-on-year, far outpacing Axis Bank (34%) and ICICI Bank (30.6%). However, the latest filings show wholesale advances up 56% to ₹62,849 crore in Q2 FY27, with a retail:wholesale mix of 56:44. This growth is driven by a deliberate strategy to move up the risk curve into better-rated wholesale borrowers and deepen relationships with large corporates previously inaccessible due to ratings or cost of funds. Investor Presentation +3
But is it sustainable? RBL's credit-deposit ratio is high at 93.1%, and management has said the equity infusion from Emirates NBD "will run out in 6 months, 9 months". Capital ratios remain strong (CET1 29.0%), but the rapid growth flatters asset quality ratios—gross NPA fell to 1.02% in Q2 FY27, partly because a quickly growing book lowers ratios before loans season. The real pressure point is credit cards, not corporate loans, with slippages in cards and personal loans running at about 15–16% annualised. Transcript +3
The pipeline is heavily skewed toward new-age sectors. SBI is "extremely oriented" toward renewables, with a green portfolio of about ₹1 lakh crore, mainly renewables. It's processing many battery energy storage proposals and data centre cases. Kotak Mahindra Bank's Anu Agarwal notes that capex is picking up in steel and cement, with solar module and cell makers and semiconductor manufacturing also attracting fresh investment. Transcript +2
Policy tailwinds are significant. The Union Budget 2026–27 set capital expenditure at ₹12.2 lakh crore, with effective public investment rising above ₹17 lakh crore when grants-in-aid are included. The GST rate on cement was cut from 28% to 18%, improving affordability. For steel, the government's preference for domestically manufactured iron and steel in public procurement and the specialty steel PLI scheme support demand.
Semiconductors are a different beast. The India Semiconductor Mission (ISM) has a ₹76,000 crore incentive framework, with 10 projects worth ₹1.60 lakh crore approved by December 2025. These projects need long-tenor financing and composite structures like mezzanine or equity funding, which SBI is building through CHAKRA. Private banks have been quieter here, likely due to the long gestation and policy-linked nature of these investments. Transcript +1
The ₹7.8 lakh crore pipeline tests capital adequacy, especially for banks with smaller buffers. Central Bank of India's corporate book is ₹1.18 lakh crore, and its CET1 stands at 15.97%. Credit risk-weighted assets grew only 14.46% against 29.83% advance growth, so RWA as a share of advances fell from 60.20% to 53.07%. This mix shift cushions capital but could reverse if growth moves back toward higher-risk corporate exposures. Investor Presentation +1
SBI manages concentration through an industry concentration framework covering 37 industries and over 100 sub-segments, representing 67% of advances excluding retail and agriculture. Its top 20 borrowers were 9.59% of total exposure in FY25, down from 10.31% in FY24. PNB's corporate book is well-diversified, with infrastructure at 8.6% of domestic advances, energy at 3.8%, and iron and steel at 1.8%. Energy GNPA has fallen sharply to 0.15%, and iron and steel GNPA to 1.51%. Annual Report +4
RBL's asset quality is improving—gross NPA fell to 1.02% in Q2 FY27—but credit costs rose to ₹771 crore from ₹597 crore, driven mainly by cards. Management says excluding cards and microfinance, credit costs have been minimal over 8–12 quarters. Investor Presentation +2
Deploying the pipeline will pressure margins. PNB's corporate yield on standard advances is 7.55%, against 9% for MSME and 8.23% for the domestic book. Its NIM is 2.58% in Q2 FY27, below the 2.60–2.70% guidance, but management expects to reach it as low-yield loans are exited and deposit costs fall. Canara Bank expects to sustain NIM at 2.55% even with a 25 bps rate hike, as 53% of its book is repo-linked and it's using cheaper FCNR(B) deposits to cut funding costs. Transcript +4
RBL's profitability has surged—net profit rose 170% year-on-year to ₹482 crore in Q2 FY27, with NIM jumping to 4.61% from 4.13% in Q1. This reflects operating leverage (cost-to-income fell to 56.48%) and the equity infusion, not inherently high corporate margins. HDFC Bank, by contrast, grew corporate and wholesale loans 18.6% but reported modest profit growth, with NIM at 3.3% and cost-to-income at 39.2%. Investor Presentation +3
Central Bank of India's ₹12,000 crore pipeline is small relative to its NII of ₹4,146 crore in Q2 FY27. Even full drawdown at a 7.87% yield adds only about ₹944 crore of annual interest income, and the net benefit is smaller if funded from investments yielding 6.82% or fresh deposits at 4.60%. Investor Presentation +2
The ₹7.8 lakh crore pipeline is a clear signal that India's capex cycle is gaining momentum. But the story isn't uniform. SBI is the heavyweight in large-ticket, sunrise-sector financing. PNB and Canara are balancing growth with yield discipline. RBL is chasing volume with fresh capital but faces sustainability questions. Central Bank is growing off a low base. Private banks like Axis, ICICI, and HDFC are more selective, focusing on mid-market relationships and pricing discipline.
For investors, the key is to watch how quickly these pipelines convert into actual disbursements—and whether banks can maintain asset quality and margins as they do. The capex revival is real, but the winners will be those who grow without compromising on risk.
