Credit quality of Indian companies likely to remain stable in H2FY26

Rating agencies say easing monetary cycle, declining inflation supporting this

Credit quality of Indian corporates is expected to be stable in the second half of the current financial year (H2FY26), supported by easing monetary cycle, declining inflation coupled with income tax relief and rationalisation of the goods and service tax (GST) rates among others.

 

However, the export oriented sectors remain vulnerable to the global macroeconomic headwinds and trade negotiations.

 

Crisil Ratings said there were 499 upgrades and 230 downgrades in its rating universe in H1FY26. Ratings credit ratio, or the proportion of rating upgrades to downgrades, moderated to 2.17 times in H1FY26 from 2.75 times in the second half of