Rating companies post more upgrades for India Inc as credit quality improves
credit ratio, or the proportion of upgrades to downgrades, indicating an improvement in Indian firms' credit quality.
But they warn of some concerns like rise in unsecured lending and household debt, and stress in export oriented sectors.
Also, several global risk factors are at play, resulting in potential credit risk transmission for the commodity producers in India. Geopolitical developments also add to the uncertainty.
For Crisil, overall, there were 506 upgrades and 184 downgrades. The credit ratio increased to 2.75 times in the first half of this fiscal from 1.79 times in the second half of last fiscal. This highlights the sustained strengthening of India Inc's credit quality.
«Rating upgrades continued to surpass downgrades, reflecting resilient domestic growth, supported by the government's continued policy support towards infrastructure build, revival of rural consumption demand and leaner corporate balance sheets,» said Subodh Rai, managing director of Crisil Ratings.
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