Page 5 - Crisil Report

Indian policymakers must balance growth amid global energy, tech shifts

While the economy is expected to recover in the second half, growth for this full financial year will be slower than initially projected

CRISIL analysis: Sprint towards power sector's 500 Gw of green energy goal

As of October 2024, India's non-fossil base, including solar, wind, large-hydro and other renewables, surpassed 200 gigawatt (Gw)

CRISIL analysis: Exports, domestic demand to drive pharma sector's growth

Bulk drug exports are expected to see moderate increases, supported by volume growth from new launches, customised synthesis, and rising demand for complex drugs

India's data centre capacity to more than double by FY27: CRISIL Ratings

India's data centre capacity is set to more than double to 2-2.3 GW by 2026-27, led by increasing digitalisation as organisations increase their investments in cloud storage, Crisil Ratings said in a report on Monday. Further, the report stated that rising penetration of Generative Artificial Intelligence (GenAI) will drive the demand over the medium-term. To support the strong demand, the incremental capital expenditure would be supported by a higher proportion of debt funding, which will result in a moderate increase in debt levels, it said. Data centres cater to the computing and storage infrastructure demand as enterprises rapidly shifting their businesses to digital platforms, including cloud, a trend that has accelerated post Covid-19 pandemic, it said. The other major factor is that increased accessibility of high-speed data has led to a surge in internet usage, including social media, over-the-top (OTT) platforms and digital payments, it added. Notably, mobile data traffic

Road InvIT AUM to rise 68% to Rs 3.2 trillion by Mar 2026: CRISIL Ratings

The assets under management of infrastructure investment trusts (InvITs) in the road sector are poised to surge 68 per cent to Rs 3.2 lakh crore by March 2026 from Rs 1.9 lakh crore as of September 2024, Crisil Ratings said on Thursday. The rating agency further said the growth will be fuelled by the expansion of existing InvITs' asset pool and the emergence of new InvITs. "The AUM (assets under management) growth will be accompanied by diversification in terms of geography and concession type, which will help build resilience," Crisil Ratings said, adding that this, along with leverage levels being under control, will keep credit profiles of road InvITs strong. Infrastructure Investment Trust (InvIT) is an instrument on the pattern of mutual funds, designed to pool money from investors and invest in assets that will provide cash flows over a period of time. According to the rating agency, the AUM growth will also bring diversification in terms of geographies and concession types.

High interest rates, fiscal consolidation slowing GDP growth: CRISIL

Some technical factors, such as net product taxes and the GDP deflator, have also disrupted GDP's trajectory

SBI Long Term Equity Fund: The Swiss Army knife toolkit for equity funds

The scheme aims for long-term capital growth by investing in a portfolio of equity securities while offering tax benefits under Section 80C of the Income-Tax Act, 1961

No negative actions so far by investors on Adani after indictment: CRISIL

Backing embattled Adani Group, rating agency CRISIL Ratings on Friday said the conglomerate has sufficient liquidity and operational cash flows to meet debt obligations and committed capex and that there has been no negative actions so far by lenders and investors following the US indictment of group founder chairman. The Adani Group, which has the flexibility to reduce certain discretionary capital expenditure (capex) depending on developments in financial markets and future capital availability, has a healthy Ebitda and cash balance that reduces its dependence on external debt to sustain operations, it said in a bulletin. On November 20, 2024, the United States Department of Justice and the US Securities and Exchange Commission (SEC) issued an indictment and a civil complaint, respectively, in the United States District Court for the Eastern District of New York, against Gautam Adani, Sagar Adani and Vneet Jaain, key functionaries of Adani Green Energy Ltd (AGEL). The charges rela

Tyre makers expected to see 7%-8% revenue growth this fiscal: CRISIL

Tyre makers are expected to see a 7-8 per cent topline growth during the current fiscal, driven by a 3-4 per cent increase in realisations and volume, ratings agency Crisil Ratings said on Monday. This would be for the second consecutive year that the estimated revenue growth for the tyre manufacturer will be in single digit (albeit nearly double than that of last fiscal) and after logging a compound annual growth rate of 21 per cent between fiscals 2021 and 2023, Crisil Ratings said. It also said that realisation growth will be staggered throughout the fiscal as companies are raising prices gradually to offset the surge in the cost of natural rubber. Volume growth, meanwhile, will be driven by replacement demand, Crisil Ratings said, adding that the analysis is based on the performance of top six tyre makers, which account for around 87 per cent of the industry's revenue. According to the ratings agency, the high natural rubber prices and limited ability to pass on these costs du

Lower APM gas allocation to raise city gas cost by Rs 2-3 per kg: CRISIL

The gas procurement cost of city gas distribution (CGD) companies is set to rise by Rs 2-3 per kilogram (kg) following a reduction in allocation of input natural gas under the administered price mechanism (APM), rating agency Crisil said Wednesday. City gas operators get priority gas allocation at reduced prices under APM from legacy gas fields for the domestic compressed natural gas (CNG) and piped natural gas (PNG) - domestic segments. As per recent public announcements by these companies, GAIL (India) Ltd, the nodal agency for domestic gas allocation in the country, has reduced the APM gas allocation for the CNG segment by 20 per cent of their CNG requirement, effective October 16, 2024. "To note, APM allocation for CGD players will now be reduced to about 50 per cent of their CNG requirement, from the allocation level of around 70 per cent this fiscal year so far," Crisil said in a note. So, to maintain adequate supply, the CGD players will need to procure gas from costlier ...

Cement industries growth to slow down to 7-8% to 475 MT in FY25: CRISIL

The cement industry is expected to record slower growth of 7 to 8 per cent to 475 million tonnes this fiscal, impacted by lower growth in the first half after registering a double-digit growth from the last two financial years, according to a Crisil report. The cement demand grew only 3 per cent in the June first quarter of FY2024-25, owing to an extended heatwave and shortage of labour during general elections and is estimated to have grown at a similar pace in the second quarter due to seasonal weakness. However, the second half is likely to bode well for the sector, the agency in its report said, adding that the margins would be better this fiscal. "Cement demand is set to grow slower at 7-8 per cent year-on-year to 475 MT this fiscal, after clocking a compound annual growth rate of 11 per cent between fiscals 2022 and 2024," the report said. However, the operating profitability of cement players is likely to sustain at Rs 975-1,000 per tonne, above the decadal average of Rs 963

Profitability of small finance banks likely to decline in FY25, says CRISIL

The profitability of small finance banks, measured in terms of return of assets (RoA), will moderate around 40 basis points to about 1.7 per cent this fiscal from 2.1 per cent in last financial year due to lower net interest margins (NIM) and higher credit costs, said a report. That said, RoA for small finance banks (SFBs) will still be higher than that for the overall banking system by 50-60 bps on account of the relatively higher yielding nature of their loan book, Crisil said in the report. Last month, Reserve Bank Deputy Governor Swaminathan J had asked SFBs to be vigilant and ensure that risks are mitigated in time. He also highlighted the importance of sustainable business models. He underscored the need to strengthen cybersecurity to safeguard against digital threats. The report said NIM for SFBs is expected to contract 15 bps as they continue diversifying to secured asset classes, which have relatively lower yields. Credit cost, meanwhile, may rise to about 40 bps because

CRISIL jumps 12 places to 37th spot in Chartis RiskTech100 2025 report

/ -- CRISIL Ltd, the global provider of advanced analytics and credit risk management solutions, has risen 12 places to #37 in the RiskTech100 2025 report published by the London-based Chartis Research this month. This is the second consecutive year that CRISIL has featured among the top 50. The independent annual assessment ranks the world's 100 best providers of risk and compliance technology and services. The report also recognises CRISIL as a Category Leader in model validation for the third consecutive year, based on a risk technology survey, product demonstration, customer reference checks, and third-party sources of information. The process evaluated CRISIL's capabilities across the model risk lifecycle, including model development, validation, governance, inventory management, and risk management and control. Gurpreet Chhatwal, Chief Operating Officer, CRISIL Limited, says, "These awards reflect the strength of our service and technology offerings in the risk management spac

CRISIL expects 25% hit on discount brokers' PBT over regulatory changes

The market regulator's mandate on uniform transaction charges or true-to-label norms, exchanges have removed the rebate benefit available to discount brokers in the previous slab-wise rates

Education sector expected to see 12-14% revenue growth in FY25: Crisil

The education sector is well-positioned for growth, supported by higher enrolments, new courses, and ongoing infrastructure investments

Peak power demand declines in Sept; renewable energy generation increases

While coal and gas-based power generation experienced reductions of 5% and 15%, respectively, hydro, nuclear, and renewable energy sources saw a rise

TN readymade garment exporters' profit may rise by 8-10% in FY25: CRISIL

Readymade garment exporters from Tamil Nadu are likely to see 8-10 per cent growth in revenue to Rs 43,000 crore in this financial year on healthy order flow amid rising demand conditions, a report said on Friday. The industry has seen signs of recovery in Tamil Nadu after two years of subdued demand and muted realisations and is expected to fare better than the national level where revenue growth is expected to be 3-5 per cent this fiscal. Operating profitability will improve 25-30 basis points (bps) on better operating leverage, marginal increase in realisations and stable yarn prices, Crisil Ratings said in a report. "Tamil Nadu readymade garment industry, which accounts for over 30 per cent of readymade garment exports from India, will see volume grow 6-7 per cent in the current fiscal. Growth will be driven by the Tirupur region, the knitwear hub of India, supported by improving demand from the US and Europe. "The government's plan to review the Production-Linked Incentive (PL

Veg thali cost rises 11%, non-veg thali falls 2% in Sept 2024: Crisil

A sharp rise in prices and a shortage of onions, potatoes, and tomatoes have driven up the costs of veg thalis in September 2024

Digital transformation to drive media revenue growth to 8% by FY2027

The report analysed 20 media companies accounting for nearly 55 per cent of the media industry's revenue

NBFCs turning to alternative funding sources amid slower bank loans

This shift has been spurred by changes in banking regulations, making it more difficult for NBFCs, especially those with lower credit ratings, to secure bank funding