Crisil Report

India's data centre capacity is projected to rise fivefold to 7.5 GW by FY30, driven by GenAI demand and digitalisation, though power infrastructure bottlenecks pose risks to expansion

India's data centre industry is poised for an unprecedented investment boom, with installed capacity expected to increase five-fold to around 7.5 gigawatts (GW) by March 2030, attracting investments of more than Rs 3 lakh crore over the next four financial years, Crisil Ratings said in a report on Tuesday. The expansion, fuelled by generative artificial intelligence (GenAI), enterprise digitalisation and rising data consumption, is set to transform the country's digital infrastructure landscape. However, the industry's ability to translate demand into sustainable returns will depend critically on timely power connectivity, regulatory clearances and disciplined project execution. "Nearly half of the upcoming capacity is already committed under long-term contracts, limiting speculative development and reducing offtake risk," Crisil Ratings said. "Upfront tie-ups with hyperscalers, driven by cloud adoption and compute-intensive GenAI workloads, provide revenue certainty from the outset

Crisil said India Inc is increasingly turning to M&As for faster growth, with annual deal volumes more than doubling since FY17 as leverage and capex intensity decline

Corporate revenue is estimated to have grown 11-11.5 per cent in the June quarter as companies raised prices, but higher fuel and freight costs squeezed margins

Tier-2 housing demand rises 14% CAGR; affordability becomes key concern

Rating agency says diversification into gold, MSME and property-backed loans, along with a recovery in microfinance disbursements, will drive growth this fiscal

The profitability impact of the recent West Asia conflict on corporate India is likely to be about half as severe as initially feared if the US-Iran ceasefire holds and energy supplies continue to normalise, Crisil Ratings said. The ratings agency said it now expects the conflict to shave around 100 basis points off India Inc's operating margins in fiscal 2027, compared with its earlier estimate of a 200-basis-point hit under a prolonged conflict scenario that included disruption to shipping through the Strait of Hormuz. The revised outlook follows a sharp correction in crude oil prices after the reopening of the Strait of Hormuz under a fragile US-Iran memorandum of understanding, although Crisil cautioned that geopolitical risks remain elevated and gas supplies could take longer to normalise. "If the armistice sustains, two-thirds of the 34 sectors (we assessed) will see minimal disruption, with margin recovery in the second half mostly offsetting pressures of the first half," sai

Crisil Ratings says ECLGS 5.0 could add around 10% debt to rated companies as firms seek funding support to manage higher working capital needs amid the West Asia conflict

Crisil states 22 of the 34 sectors stress-tested could see operating profitability decline by over 10 per cent as companies may not be able to fully pass on higher costs to consumers immediately

The rating agency said that only eight sectors, accounting for around 10 per cent of rated corporate debt, were expected to see a material impact on credit quality

Crisil Ratings expects India's passenger vehicle industry to post record sales this fiscal, supported by GST-led demand recovery and continued preference for utility vehicles

Crisil says expanding cash transfer schemes are supporting low-income households, but rising state borrowing and fiscal pressures could challenge their long-term sustainability

Mobile phones, consumer electronics and industrial electronics together account for 55-60% of electronics sales in India

Alcobev firms may see margins shrink 150-200 bps and growth slow as glass bottle shortages and rising packaging costs, driven by LNG disruptions, weigh on operations

Crisil sees strong infrastructure investment growth through FY28 backed by policy support and balance sheets, though risks persist across renewables, roads and real estate

Non-banking finance companies' (NBFCs) reliance on bank borrowings is likely to rise in FY27 due to lower interest rates, a rating agency said on Wednesday. The share of bank borrowings, which rose to 43 per cent on the back of higher activity in the second half of the recently concluded FY26, will inch up further to up to 45 per cent by the end of the ongoing fiscal, Crisil Ratings said. It attributed the shift in preference to lower interest rates in the bank lending market, which is likely to lead to a tapering in the debt capital market issuances. "While bank lending rates continued to decline throughout last fiscal, bond yields, after declining in the first half, inched up in the second half and remain elevated," the agency said. Additionally, the share of external commercial borrowing (ECB) issuances will also be muted in the near term, owing to geopolitical uncertainties and the resultant exchange rate volatility, it added. In such a scenario, securitisation is expected to

Growth in housing sales value is set to moderate in FY27 amid flat demand and slower price increases, though strong collections and premium segment demand will support developers

India's annual domestic output of urea and complex fertilisers is likely to decline by 10-15 per cent due to supply chain disruptions caused by the ongoing conflict in the Middle East, a Crisil Ratings report said on Thursday. "The ongoing issues in the Middle East could disrupt the fertiliser supply chain at a crucial time for the kharif season. Disruption in LNG and ammonia supplies continuing for about three months could cut domestic urea and complex fertiliser production by 10-15 per cent," Crisil Ratings Director Anand Kulkarni said. However, he said the impact on production will be cushioned to some extent by the recent government directive allocating 70 per cent of gas to urea manufacturers. He added that the fertiliser inventory of around three months, along with expected imports from alternative sources, will mitigate the risk of immediate supply shortages. Further, Crisil Ratings said the increase in prices of raw materials and imported fertilisers is likely to increase .

Manual services account for 75-80 per cent of the market and involve providing security personnel to man public spaces, housing societies, commercial complexes and banks, among others

Crisil warns over 35 GW renewable capacity may face curtailment in FY27 due to slow transmission rollout, with TGNA projects bearing the bulk of the risk