MSME margins to shrink on Covid-induced loss of demand: CRISIL SME Tracker

CRISIL Research expects the likely contraction of 5 per cent in India’s gross domestic product (GDP) in the current fiscal year to impact micro, small and medium enterprises (MSMEs) especially hard — and micro units harder than their small and medium peers.
 

Long constrained for liquidity, MSMEs now also have to cope with loss of demand, labour shortage, and heightened risk aversion in the financial system due to the Covid-19 pandemic. All this will stretch their already-strained financials.
 

CRISIL Research expects MSMEs to log a revenue contraction of 17-21 per cent this fiscal. Among key sectors, consumer discretionary and construction