Page 9 - Icra

53 mn sq ft office space eligible to be monetised via SM-REIT for Rs 70K cr

Rating agency ICRA has estimated that around 530 lakh square feet of office spaces are eligible for small and medium REITs (SM-REIT) listing, creating a monetisation opportunity of Rs 67,000-71,000 crore. In November last year, the Sebi board cleared the amendments to the REITs Regulations, 2014, in order to create a regulatory framework for the facilitation of SM REITs, with an asset value of at least Rs 50 crore vis-a-vis minimum asset value of Rs 500 crore for existing REITs. As per the notification, the minimum price of each unit of the scheme of SM-REIT shall be Rs 10 lakh or such other amount as may be specified by Sebi from time to time. The size of the asset proposed to be acquired in a scheme of the SM-REIT is at least Rs 50 crore and less than Rs 500 crore. "Small and Medium REITs will provide an opportunity for small Grade A and most of the Grade B office developers to monetise their investments. Also, Fractional Ownership Platforms (FOPs) are expected to be formalised, .

India's core sector growth slows to 5.2% in March from 7.1% in February

In March 2023, the core sector had recorded a growth of 4.2 per cent

India's oil import bill could swell to $101-104 billion in FY25: ICRA

India's net oil import bill could widen to USD 101-104 billion in current fiscal from USD 96.1 billion in 2023-24 and any escalation in the Iran-Israel conflict could impart an upward pressure on the value of imports, ICRA said on Tuesday. The domestic rating agency said based on its analysis, lower value of Russian oil imports is estimated to have led to savings of USD 7.9 billion in 11 months (April-February) of 2023-24, up from USD 5.1 billion in 2022-23. "With India's oil import dependency expected to remain high, if the discounts on purchases of Russian crude persist at the prevailing low levels, ICRA expects India's net oil import bill to widen to USD 101-104 billion in FY2025 from USD 96.1 billion in FY2024, assuming an average crude oil price of USD 85/bbl in the fiscal," ICRA said. Additionally, any escalation in the IranIsrael conflict and an associated rise in crude oil prices could impart an upward pressure on the value of net oil imports in the current fiscal year, it .

Construction sector firms' revenues to see 12-15% growth this fiscal: ICRA

India's construction sector entities' revenues are likely to grow by 12-15 per cent in the current financial year, while margins will expand by 25-50 bps, rating agency ICRA said on Monday. It further said that the government's infrastructure push will result in double-digit revenue growth for the construction industry in FY2025. The rating agency said it maintains a stable outlook on the sector with steady growth in operating income, moderate leverage, and healthy coverage metrics. "The aggregate order book-to-sales ratio of ICRA's sample set of companies stood at around 3.9x as of December 2023 (compared to 3.4 times during March-2023), thereby indicating a healthy revenue growth prospect over the medium term," ICRA vice president and co-group head - corporate ratings Ashish Modani said. He said, ICRA expects the revenue growth in FY2025 to remain healthy at 12-15 per cent on a year-on-year basis, albeit slightly lower than the 18-20 per cent revenue expansion assessed for FY2024

Expect capex for EV components to cross Rs 25K cr in next 3-4 years: Icra

The auto component industry is expected to invest over Rs 25,000 crore in the next 3-4 years to expand production of electric vehicle parts, rating agency Icra said on Tuesday. EV penetration in the country has reached 4.7 per cent in FY2024, with much of it driven by the electric two-wheeler segment, although e-three-wheelers and electric buses have also contributed to the same, it said in a statement. There has been substantial localisation in traction motors, control units, and battery management systems over the years, Icra said. However, advanced chemistry batteries, which remain the most critical and the costliest component, accounting for almost 35-40 per cent of the vehicle price, are imported, it added. The low localisation levels give rise to manufacturing opportunities for domestic auto component suppliers, it said. "Icra expects at least Rs 25,000 crore of capex for EV components in the next three-four years, for capacity building, technology and product enhancements,"

Good times ahead for United Breweries as heatwave, IPL set the tone

The company is expected to increase its volumes in the March quarter by 9% Y-o-Y on the back of market share gains in N India

Volumes of domestic mining, construction equipment may drop in FY25: ICRA

Rating agency ICRA on Thursday said the volumes of domestic mining and the construction equipment (MCE) industry may drop in the current financial year on account of a slowdown in the new project orders amidst Lok Sabha elections and monsoon-related impact on construction activities. "ICRA expects FY2025 to see a 12-15 per cent year-on-year decline (which translates into volumes of 1.14-1.18 lakh units)," the rating agency said in a statement. This drop is following two consecutive years of strong growth of 26 per cent in FY'23 and 24 per cent in FY'24. "The reversal in this growth trend will be driven by a slowdown in the new project award activity in Q4 FY2024 and Q1 FY2025, as the Model Code of Conduct will remain in force during the Parliamentary Elections in April-May 2024 (till the announcement of results on June 4, 2024). "Additionally, the aggregate revenues for ICRA's sample set companies are expected to contract by 9-12 per cent and operating margins by 100-150 basis poin

Govt likely to construct 5-8% more roads in 2024-25, says ICRA report

Since Prime Minister Narendra Modi took office in 2014, India built about 90,000 kilometres of national highway, almost double that constructed in previous decade, according to government estimates

Road execution in India to grow 5-8% in FY25 to 12,500-13,000 km: ICRA

Road execution in India is likely to grow 5-8 per cent to 12,500-13,000 km in the current fiscal, after recording a robust expansion of 20 per cent in 2023-24, rating agency Icra said on Tuesday. It added that the pace of execution in this fiscal will be supported by a healthy pipeline of projects, increased capital outlay by the government and focus on completion of projects by Ministry of Road Transport and Highways (MoRTH). Icra noted that road execution was impacted in the first half of FY24 on account of a prolonged monsoon in certain geographies, which affected productive days. According to Icra, the ministry's project award pipeline is healthy, at above 45,000 km as of March 2024. This is despite the awarding being significantly impacted in FY24 amid delay in approval from the Cabinet for the revised cost estimates of Bharatmala Pariyojana Phase 1 (BMP), it added. Consequently, the overall awards declined by 31 per cent to 8,551 km in FY24 from 12,375 km in FY23. Icra poin

ICRA revises FY25 outlook for banking sector to 'stable' from 'positive'

Rating agency expects credit growth and profitability to moderate in the sector

EU carbon tax may have limited impact on domestic aluminium producers: ICRA

Rating agency Icra on Tuesday said that the proposed European Union's carbon tax may have a limited impact on the domestic primary aluminium producers. The CBAM (Carbon Border Adjustment Mechanism) or carbon tax (a kind of import duty) will come into effect from January 1, 2026. "The Carbon Border Adjustment Mechanism (CBAM) ruling on exports to the European Union (EU) will have a limited impact on the domestic primary aluminium producers. This is because the present notification covers the financial impact w.e.f January 1, 2026, on direct process-related emission only, while excluding the indirect emission, which contributes 80 per cent to the total emissions in the primary aluminium production process," Icra said in a statement. The indirect emission primarily results from the production of electricity that is subsequently consumed in the smelting process. India exported around 0.7 metric million tonnes (24 per cent of exports) of primary aluminium to European countries in FY23.

Indian road logistics industry revenues to grow at 3-6% in FY25: ICRA

The Indian road logistics industry's revenue will remain range-bound and grow at a slower pace of 3-6 per cent in the current financial year, rating agency ICRA said on Monday. The rating agency further said it expects softening in the government capex during the elections (given the Model Code of Conduct requirements) and moderation in consumer demand sentiments amid high inflation and interest rates. ICRA said operating profit margins are expected to remain range-bound at 10.5-12.5 per cent in FY2025 as concerns on cost inflation persist. The outlook for the sector continues to be stable, fuelled by sustained momentum in economic activities, enhanced traction of organised trade and continued support from varied segments like e-commerce, FMCG, retail, pharmaceuticals, and industrial goods. It said e-way monthly volumes remained largely stable in the last four months at above 85 million, post reporting all-time high volumes of 100 million in October 2023, signifying resilient domes

Northern Arc Capital seeks Rs 385 crore PE funding ahead of market debut

The company has filed a prospectus for IPO, which it is planning to launch in the first half of FY25

Monetary policy review: RBI rejigs quarterly GDP growth forecasts for FY25

Rural demand catching up, consumption expected to support economic growth in FY25, says RBI governor

SFBs securitise loans worth Rs 9,300 crore to generate liquidity

The securitisation volumes in Q4 FY24 witnessed healthy growth of 26 per cent over the preceding quarter, rising to Rs 48,000 crore

Securitisation volume growth slows to 4% in FY24 on HDFC merger: ICRA

The overall securitisation volume growth slowed to 4 per cent in FY24 to Rs 1.88 lakh crore due to the impact of the HDFC twins merger, domestic rating agency Icra said on Thursday. In FY23, the securitisation volume had grown by 33 per cent to Rs 1.80 lakh crore, and mortgage major HDFC was the biggest originator. In a report, the agency said it expects the volume of securitisation - where a lender typically transfers the future receivables on a loan asset against upfront payment - to cross Rs 2 lakh crore in FY25. "The increasing share of co-lending by NBFCs (non-bank finance companies) and HFCs (housing finance companies) would challenge the growth in the securitisation market, though at this juncture we expect an increase in both forms of funding," Icra's group head for structured finance ratings Abhishek Dafria said. He added that if HDFC is excluded, the securitisation volumes grew 25 per cent during the fiscal year. "The increase in volumes was driven by both existing large

India Inc's credit quality remains healthy in H2FY24: Rating agencies

While commodity prices have softened, revenue of upgraded companies in the CRISIL rating pool grew by about 13 per cent in fiscal 2024 largely led by a pick-up in volume

Despite the challenges, credit quality of India Inc improves in FY24: ICRA

According to the agency, the Credit Ratio in FY24 stood at 2.1 times, with the rating agency upgrading two entities for every entity downgraded, continuing the trend from the last two financial years

MPC may keep repo rate, stance unchanged at FY25's 1st meet: BS Poll

The RBI will announce the review of the policy on April 5

Domestic demand growth for non-ferrous metal may remain 10% in FY25: Icra

Domestic demand growth for non-ferrous metals such as aluminium and copper is likely to remain at 10 per cent in the next financial year, Icra said on Friday. The apparent consumption growth for non-ferrous metals in the domestic market remained at 10-13 per cent in the first nine months of the ongoing fiscal supported by the government's push on infrastructure development and encouraging demand from renewables sectors and electric vehicles. "While the demand is expected to remain soft over the next two quarters as government spending moderates around the general elections, the overall demand growth is expected to remain comfortable at 10 per cent in FY24 and FY25," Icra said in a statement. The operating margin of domestic players is also likely to remain stable at 17-17.5 per cent in FY25, like the levels estimated in FY24. Consequently, the rating agency maintains a stable outlook on the sector, it said. "Icra notes that the domestic e-auction premia on coal had eased in recent