Page 14 - Icra

Domestic steel demand to grow 9-10% in FY24, says revised ICRA estimate

Domestic steel demand, ICRA said, was poised to grow at a double-digit compounded annual growth rate (CAGR) of 10.5-11 per cent between FY2022 and FY2024

Domestic air passenger traffic rises about 23% to 1.24 cr in August: ICRA

India's domestic air passenger traffic rose about 23 per cent year-on-year to 1.24 crore in August and was 6 per cent higher than the pre-Covid level (August 2019) of around 1.18 crore, credit rating agency Icra said on Thursday. On a sequential basis, the growth in traffic during the previous month was around 3.2 per cent, with 1.21 crore passengers flying on domestic routes in July, it added. Also, the capacity deployment in the reporting month grew 10 per cent against August 2022 and lower by 1 per cent in comparison to the pre-COVID levels (August 2019), Icra said. The ratings agency said the outlook on the domestic aviation industry is 'stable' on the back of the fast-paced recovery in domestic passenger traffic in the previous fiscal and expectations of the trend continuing in this fiscal as well. Moreover, the industry witnessed improved pricing power, reflected in the better yields and thus the revenue per available seat kilometre cost per available seat kilometre ...

ICRA revises outlook for petrochemicals to negative profitability concerns

Rating agency Icra has revised the outlook on the petrochemicals and basic chemicals industries to negative from stable due to weak demand and global supply glut. Outlook on specialty chemicals remains stable, with profitability expected to moderate in FY2024, but not trigger an outlook change at this stage, it said, adding that the petrochemical and basic chemicals industries are likely to face pressure on operating rates and profitability. "The petrochemicals and basic chemicals industries have been facing headwinds on account of weak demand amid a global supply glut, owing to capacity expansions in several chemicals. "This is likely to exert pressure on the operating rates as well as profitability of the petrochemical and basic chemical players," Icra said in a statement. As for the specialty chemicals segment, while profitability is expected to moderate in FY2024, the extent is expected to be mild enough to not trigger an outlook change at this stage. According to Prashant ...

Net office leasing across 6 cities may fall 10% this fiscal: ICRA

Rating agency ICRA on Tuesday said net leasing of office space across six major cities is estimated to decline by 10 per cent this fiscal, from 57 million square feet in the previous year. The fall in office demand coupled with an influx of huge supply in FY2024, would result in a marginal rise in vacancy levels by 60 basis points to 15.5 per cent by the end of FY2024. These top six cities are Mumbai, Bengaluru, Delhi-NCR, Hyderabad, Chennai, and Pune. Its sample includes 22 commercial office operators totalling 165 million square feet area. "The office developers are expected to witness a revenue growth of 11-13 per cent in FY2024 for ICRA's sample set of non-REIT companies, supported by scheduled rent escalation and improvement in occupancy levels of reputed office players," the agency said in a statement. Further, the rental rates are estimated to rise by 3-5 per cent YoY in FY2024, driven by contracted escalations/lease renewals at higher rates. ICRA's outlook on the commercia

10-12% price hike in commercial vehicles likely: Credit rating agency Icra

There are a number of proposed regulatory changes that could further increase the cost of CVs

New regulation can raise commercial vehicle prices by 10-12%: ICRA

Implementation of multiple proposed regulatory specifications can push up commercial vehicle prices by 10-12 per cent, ratings agency ICRA said on Monday. In its report on the Indian commercial vehicle industry, ICRA said the domestic automotive industry is undergoing rapid transformations, with increased focus by the government on implementing emission norms, safety systems and other standards that will bring the country at par with other major automotive markets. "Within the Indian automotive industry, the commercial vehicle (CV) sector has been the focus, given that CVs account for the major part of vehicular emissions in the country," it said, adding mandatory standards towards driver comfort and safety can help improve the driving conditions and road safety to a large extent. Accordingly, ICRA said there have been multiple regulatory interventions in the recent past, with the industry adopting stringent emission standards in a relatively short span of time, as well as driver ..

India's GST collection increases 11% to Rs 1.59 trn on better compliance

The government expects average monthly GST collection to be Rs 1.6-1.65 trillion this financial year

IT firms' growth in Q1 FY24 lowest in 10 qtrs, slowdown to get worse: ICRA

Order book and deal pipeline of most companies remain strong, says ratings agency

IT services sector's revenue growth to slow down to 3% in FY24: ICRA

Indian IT services sector's revenue growth will slow down to 3 per cent in the current fiscal from 9.2 per cent in the previous financial year, a domestic ratings company said on Tuesday. Icra Ratings said the profitability will also take a beating in this financial year and the operating profit margin will narrow by up to 1 percentage point to 20-21 per cent. The topline growth will come down to 3-5 per cent in FY24 from the 9.2 per cent posted in FY23, the agency said, attributing the slowdown to softening demand. The agency's sector head Deepak Jotwani said there has been "persistent uncertainty" in the key markets for IT companies which has resulted in pauses and deferral of non-critical projects and slowdown in discretionary IT spends by key sectors like banking, financial services and insurance, retail, technology and communication. As per industry lobby Nasscom, the sector directly employs over 50 lakh people while analysts say it was crucial for the post-pandemic recovery o

ICRA estimates GDP growth at 8.5% in Q1, maintains FY24 forecast at 6%

India's economic growth will accelerate to 8.5 per cent in the April-June period of the current fiscal from the 6.1 per cent growth rate witnessed in the preceding January-March quarter, Icra Ratings said in a report on Tuesday. The rating agency attributed the faster growth to a supportive base and also a recovery in the services sector. Though its estimate is higher than the RBI's forecast of 8.1 per cent, Icra's chief economist Aditi Nayar said the second half of the fiscal is likely to witness headwinds, which will prove a dampener. Nayar said erratic rainfall, narrowing differentials with year-ago commodity prices, and possible slowdown in momentum of government capex "as we approach the Parliamentary elections will limit the growth", and maintained her 6 per cent real GDP growth estimate for FY24 which is lower than RBI's 6.5 per cent. In the first quarter, unseasonal heavy rains, lagged effect of the monetary tightening and weak external demand exerted a downward pressure on

Corporate hospitals to see 8-10% revenue growth in FY24: ICRA Ratings

Corporate hospitals are set to clock an 8-10 per cent revenue growth and strong margins in the current fiscal, ICRA Ratings said in a report on Thursday. The rating agency maintained a stable outlook for the sector, saying the improving operating leverage, coupled with continued cost optimisation and digitisation measures, are expected to support a healthy operating margins of 22-23 per cent in 2023-24 (FY24). The report is based on the agency's sample of nine listed hospital chains -- Apollo Hospitals, Aster DM Healthcare, Fortis Healthcare, Healthcare Global Enterprises, Krishna Institute of Medical Sciences, Max Healthcare, Narayana Hrudayalaya, Rainbow Children's Medicare and Shalby Hospital. Higher revenue and margin expectations are led by rising incidence of non-communicable lifestyle diseases, growing per capita spend on healthcare, increasing number of health insurances being availed of, and an increase in medical tourism, it said. The report said the aggregate occupancy

Hospital revenues to grow 8-10% in FY24 on rise in lifestyle disease: ICRA

The rating agency expects the aggregate occupancy for its hospital industry's sample set to remain strong at 60-65 per cent in FY24, building on the prior year's 65.1 per cent

Telecom service industry to see revenue growth up by 7-9% in FY24: ICRA

The telecom services industry is expected to post moderate revenue growth of 7-9 per cent in FY 24, due to muted average revenue per user (ARPU) expansion in the absence of tariff hikes in the near-term, ICRA said. ICRA believes that the ongoing 5G roll-out entails densification of the network and sizable deployment of fibre, which is likely to increase the capex intensity in the near to medium term. This would keep debt levels elevated at around Rs 6.1-6.2 lakh crore as on March 2024 (as against Rs 6.3 lakh crore as on March 31, 2023). "ICRA expects the telecom services industry to report moderate revenue growth of around 7-9 per cent in FY2024 over FY2023, owing to muted average revenue per user (ARPU) expansion in the absence of tariff hikes in the near-term," ICRA said in a release.

Telecom sector to see 7-9% revenue growth, Rs 70,000 cr capex in FY24: ICRA

The telecom services industry is expected to post moderate revenue growth of 7-9 per cent in FY 24, due to muted average revenue per user (ARPU) expansion in the absence of tariff hikes in the near-term, ICRA said. The industry has been "upfronting" 5G capex (capital expenditure) and ICRA foresees sectoral capex at around Rs 70,000 crore for FY2024, within an overall spend of around Rs 3 lakh crore over the next 4-5 years. ICRA believes that the ongoing 5G roll-out entails densification of the network and sizable deployment of fibre, which is likely to increase the capex intensity in the near to medium term. This would keep debt levels elevated at around Rs 6.1-6.2 lakh crore as on March 2024 (as against Rs 6.3 lakh crore as on March 31, 2023). "ICRA expects the telecom services industry to report moderate revenue growth of around 7-9 per cent in FY2024 over FY2023, owing to muted average revenue per user (ARPU) expansion in the absence of tariff hikes in the near-term," ICRA said

RBI repo rate cut possible only in Jul-Sep quarter next year: Icra

Domestic ratings agency Icra on Monday said it expects a rate cut by the Reserve Bank to happen only in the July-September quarter next year. The overall cuts in the cycle will be a "shallow" 0.50-0.75 per cent, the agency said. A rate hike by RBI is possible only if the headline inflation is at over 6 per cent for two consecutive quarters, the agency said. "The MPC's (Monetary Policy Committee) latest forecasts suggest inflation will remain above 5 per cent through Q1 FY2025, based on which we have pushed out our forecast for the earliest cut to Q2 FY2025," the agency said. The official data released on Monday said consumer price inflation (CPI) spiked to a 15-month high of 7.4 per cent for July. "The data for food prices for early August 2023 is not very promising, and we expect the headline CPI inflation to print above the 6.5 per cent mark in August, before cooling off materially in September," its chief economist Aditi Nayar said. She attributed the much sharper than expecte

Indian airlines expected to report net loss of Rs 5,000-7,000 cr in FY24

Indian airlines are expected to see a sharp drop in net losses to Rs 5,000-7,000 crore this fiscal as they continue to witness healthy passenger traffic growth and improvement in their revenue, rating agency ICRA said on Thursday. The net loss would be much lower compared to the Rs 11,000-13,000 crore loss the industry is estimated to have reported for 2022-23 due to elevated aviation turbine fuel prices, coupled with depreciation of the rupee against the US dollar, it said. The airlines have improved the cost of available seat kilometre to the cost of available seat kilometre (RASK-CASK) spread through better pricing discipline, it said. According to the rating agency, the domestic aviation industry continues to face challenges despite witnessing a healthy recovery in air passenger traffic because of sequential increase in aviation turbine fuel (ATF) prices and depreciation of the value of rupee against the US Dollar. It said domestic air passenger traffic rose 26 per cent to arou

10% incremental CRR temporary, will drain out Rs 1 trn from system: RBI

Short-term rates on money market instruments like call money rates, treasury bills and commercial paper are likely to increase by 15-20 bps in the near term: ICRA

Icra Ratings logs 88% growth at Rs 41 crore in April-June quarter

Revenue during the quarter rose 11 per cent on-year to Rs 102.7 crore

GE Power gets LoI for contact worth of Rs 444 crore; stock surges 13%

Thus far in the financial year 2023-24, the stock has outperformed the market by zooming 82 per cent as against 12 per cent rise in the S&P BSE Sensex

Indian pharma to grow at 7-9% in FY24 despite regulatory risks: ICRA

ICRA's sample set includes companies such as Dr Reddy's Laboratories, Sun Pharmaceutical Industries, Cipla and Abbott