Annual Credit Outlook

A flagship annual report from our Fixed Income Credit team that deep dives into different sectors to analyse the sectoral strengths, levers, and potential challenges, juxtaposed against the current macroeconomic set up.

The report opines that Corporate India remains in good health due to balance sheet deleveraging and lower interest rates experienced over the last two years. We’ve seen a slight increase in leverage in H1 FY23 due to capex in select sectors (Telecom, Renewable) and higher working capital requirements - however, the overall debt metrics remain comfortable. As expected, operating margins have moderated in H1 FY23 mainly due to higher input costs, and are likely to improve in H2 FY23 given some cool off in input costs.