Corporate India's Credit Landscape: Navigating Tariffs and Ratings

Corporate India's credit scene saw a slight dip in the April-September period. The impact of U.S. tariffs, as highlighted by rating agencies, remains a critical factor to watch. While domestic consumption improvements provide a positive outlook, challenges for export sectors persist due to protectionist measures.

In the first half of the fiscal year, Corporate India experienced a slight moderation in credit momentum, as highlighted by various rating agencies. The credit ratio, according to Crisil, decreased to 2.17 compared to 2.75 during the same period the previous year.

Rating outlooks were mixed, with agencies monitoring the impact of U.S. tariffs closely. The tariffs pose a significant challenge, particularly for export-oriented sectors, though domestic economic factors such as GST boosts and tax cuts offer a promising outlook.

India Risks and Research and Careedge reported varied figures for ratings upgrades and downgrades, indicating a watchful but cautiously optimistic stance as the fiscal year progresses. Analysts forecast fiscal measures to support exporters in coping with ongoing global uncertainties.

(With inputs from agencies.)