BofA cautions that India's capital goods stocks have risen 11% since the Iran conflict, driven mainly by valuation expansion.
The firm projects capex growth of 10% CAGR for FY 2026‑2028, below the 15% consensus and private‑sector 7% outlook.
Central government fiscal pressure from a 1.5 trillion‑rupee excise duty cut and 400 billion‑rupee fertilizer subsidies may curb spending.
BofA rates five of six covered industrial stocks as underperform, but highlights opportunities in transformers, cables, data‑center gensets, shipbuilding and defence.