Page 2 - Icra

MPC's optimistic growth outlook augurs well for credit demand

The MPC's optimistic growth outlook for H2 FY2024 augurs well for the credit demand for the banking sector as well as the lenders, said Karthik Srinivasan of Icra

Indian IT services industry's growth might drop in near to mid-term: Icra

The growth momentum of Indian IT services industry is likely to slow down in the near to mid term as macroeconomic headwinds trigger lower discretionary IT spends, ICRA said on Monday. Ratings agency ICRA sees lower hiring by the IT service companies in the near term given that excess capacities were added in FY2022 and expects moderation in demand compared to previous fiscals amid macroeconomic headwinds. Indian IT services companies have witnessed a moderation in growth in the last two quarters in constant currency terms owing to the base effect and evolving macroeconomic headwinds in key markets of the US and Europe. Due to these headwinds, the decision-making towards discretionary IT spending has seen a slight deferment, while the cost optimisation deals continue to generate stable demand, it noted. "Growth momentum for the Indian IT services industry likely to slow down in the near to medium term," ICRA said in a statement. The slowdown is on account of evolving macroeconomic

Eco Survey paints a bright medium-term outlook after an unpredictable year

It says once the global shocks of the pandemic and 2022's unpleasant spike in commodity prices fade away, the Indian economy is likely to record a faster growth during the rest of this decade

5G infra to cost Rs 3 trn in next 4-5 yrs amid elevated debt levels: Icra

India currently has around 35 per cent of its towers fiberised for 5G and the backhaul infrastructure will cost a whopping Rs 3 lakh crore over the next 4-5 years, rating agency Icra said on Monday

States' interest cost inches up as borrowing grows 8%: Icra Ratings

After remaining stable for many weeks, the cost of borrowing for states inched up by 5 basis points to 7.64 per cent at Tuesday's auction when 15 of them raised Rs 25,700 crore from the market. The amount of debt raised today is a 13-week high and for the first time shows an annualised growth of 8 per cent year-to-date -- a first as throughout the year, the weekly borrowing has been below the year-ago weeks, yet 15 per cent lower than the indicated amount in the borrowing calendar, according to a note by Icra Ratings. The weighted average cut-off on state government loans rose 5 basis points to 7.64 per cent over the previous week, and the weighted average tenor rose to 13 years from 11 during the week. The spread between the 10-year state bonds and G-sec (government securities) yield stood at 30 basis points today, amidst an inverted yield curve, according to Aidti Nayar, chief economist and head research and outreach at Icra, said. States have cumulatively raised Rs 5.12 lakh cro

India's auto sector to grow at high single digit in FY2023-24: ICRA

The two-wheeler industry continues to struggle with industry volumes still below the pre-covid peak levels

Dec traffic at major ports sails to highest in FY23, rises 10.4 per cent

Twelve major ports handled cargo of 69.5 million tonnes in December, which is highest during current fiscal year

Toll projects may see moderate to high single-digit growth in FY24: Icra

Rating agency ICRA on Tuesday said that toll road projects in the country are likely to see moderate to high single-digit growth in FY24 with moderation in the Wholesale Price Index (WPI) inflation

Central govt's borrowings may touch Rs 14.8 trillion in FY24: Icra report

Nevertheless, as a proportion of GDP, fiscal deficit is expected to ease to 5.8 per cent from 6.4 per cent

Securitisation volumes likely to jump to Rs 1.70 trn in FY23: Icra

Securitisation volumes for FY23 can reach Rs 1,70 lakh crore, as against Rs 1,26,500 crore in FY22, a domestic rating agency estimated on Wednesday

Hospital sector likely to post healthy growth in FY23: ICRA report

Aggregate bed occupancy seen at 64% due to 'sustained improvement in demand', says agency

Bond issuance by banks to touch record Rs 1.3 trn in FY23: Report

They raised more than Rs 73,000 crore in FY22, says rating agency ICRA

Domestic air passenger traffic grew 15% to 12.9 mn in Dec 2022: Report

Domestic air passenger traffic grew 15 per cent year-on-year to around 129 lakh in December 2022 but remained 1 per cent lower than the pre-pandemic level (December 2019), rating agency Icra said on Thursday. Icra has also maintained a 'Negative' outlook on the Indian aviation industry. In the April-December period of the current fiscal, domestic passenger traffic is estimated at around 986 lakh, registering around 63 per cent year-on-year growth and lower by approximately 9 per cent compared to April-December 2019 (pre-COVID levels), it said. At the same time, the airlines deployed slightly higher capacity (less than 1 per cent) in the previous month over the year-ago period, the rating agency said, adding that it, however, was lower by around 7 per cent than the pre-COVID levels. According to Icra, the domestic aviation industry operated at an estimated passenger load factor of around 91 per cent in December 2022 against approximately 80 per cent in December 2021 and about 88 per

Elevated coal price a drag on margins of domestic base metal players: Icra

The increased price of coal continue to be a drag on the margin of domestic base metal players with no immediate relief in sight, rating agency ICRA said on Thursday. In a recent note on the primary base metal industry, ICRA said that the earnings of the industry would continue to remain under pressure in the second half of the current fiscal, following a dull performance in the first half of FY'23. "Elevated coal costs along with metal price corrections remain the key headwinds affecting the margins, with no immediate relief in sight," ICRA said in a statement. On account of input cost pressures, the rating agency said it has revised its estimates of operating profitability of domestic players downward to 18 per cent in the current fiscal. ICRA's operating profitability forecast for domestic players is almost 3 percentage points lower compared to its earlier forecast made in September last year and 10 percentage points lower compared to FY'22. "In FY2024, while some respite is ..

Global macro headwinds may moderate growth for Indian IT industry: Icra

The evolving global macroeconomic headwinds could moderate growth for Indian IT services industry over the medium term, ICRA said on Wednesday. Rating agency ICRA, in its recent research report, has cited that given the Indian IT services industry generates about 60-65 per cent of revenues from the US market and 20-25 per cent from the European market, it remains susceptible to macroeconomic uncertainties and adverse regulatory changes in these key operating markets. Deepak Jotwani, Assistant Vice President and Sector Head of ICRA, said: "Growth in the BFSI (Banking, Financial Services and Insurance) segment, one of the key segments for IT companies, has tapered more than other segments in recent quarters, and this is partially attributable to lower lending activity". If the macroeconomic headwinds persist, the mortgage lending and the retail segments are expected to witness relatively higher moderation in growth, compared to the manufacturing and healthcare segments. "While the ..

Icra revises upwards road logistics sector growth forecast to 11-13%

Rating agency Icra on Tuesday revised its growth estimates for the Indian road logistics sector to 11-13 per cent for the current fiscal against the previous estimate of 7-9 per cent. The rating agency said the growth is supported by a strong demand environment, coupled with the continuation of firm freight rates, also supported by the base effect to an extent, given that FY22 had a weak first quarter due to the second wave of COVID-19. Icra further said it expects revenue growth of the Indian road logistics sector at a higher single digit for F24 over FY23 on an elevated base and continuation of a healthy demand scenario. The debt coverage metrics of the logistic sector are expected to marginally moderate in FY23 and FY24 compared to the FY22 levels, owing to expected debt-funded capital expenditure for vehicle replacement required prior to the introduction of the scrappage policy, along with the rising interest rate regime, it added. Further, Icra said multimodal offerings are ..

Inflation kept MPC occupied in 2022, but may not hurt growth for now

Economists and businesses await to see what will be committee's stance in 2023

Airbag industry in India expected to grow to Rs 7,000 cr by FY27: Icra

The industry size of airbags, a key safety feature in vehicles, is expected to grow to up to Rs 7,000 crore by FY2027 in India, from the current levels of around Rs 2,500 crore, according to ratings agency Icra. The growth in the airbag industry, which is one of the fastest growing auto component segments, is expected to be fuelled by the increase in content per vehicle arising from higher regulatory requirements and voluntary increase in the number of airbags per vehicle for enhancing safety, Icra said in a statement. "The mandatory content per vehicle for airbag manufacturers is expected to rise from Rs 3,000-4,000 currently to Rs 8,000-10,000 by October 1, 2023. The average number of airbags per car sold is about three currently, and this is expected to increase significantly post the mandatory implementation of six airbags per car from October 1, 2023," Icra Vice President and Sector Head Vinutaa S said. Accordingly, Icra said it expects the industry to grow to Rs 6,000-7,000 ..

ICRA downgrades PTC Financial Services short-term rating over operations

Failure to improve business volumes may impact profitability of Delhi-based NBFC, says agency

Domestic demand for finished steel to grow 8% this fiscal year: Icra

The demand for finished steel in India is expected to grow eight per cent this year compared to 2021, according to rating agency Icra. Supported by the government's infrastructure-led growth model, domestic finished steel demand has registered a double-digit growth of 11.9 per cent in the first eight months of the current fiscal, the ratings agency said in a report on Wednesday. The demand is "poised to close the year with a growth of 8 per cent...7-8 per cent growth for FY 2022-23," Icra said. However, domestic steel companies "face a bumpier road ahead" as the external environment becomes more challenging due to elevated inflation/ energy prices and rising interest rates. Given the expectation of a slowdown in the pace of economic activity over the next few quarters, domestic steel demand growth is likely to moderate to 6-7 per cent in FY24, Icra said. Jayanta Roy, Senior Vice-President & Group Head - Corporate Sector Ratings at ICRA, said dependence on external financing to ...