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The Reserve Bank of India (RBI) may begin lowering <keyword id="19950650" type="General" weightage="20" keywordseo="interest-rates" source="keywords">interest rates</keyword> around October, provided that external factors like weather conditions and international commodity prices do not cause any disruptions, the credit rating agency, Crisil said in its report. The credit rating agency further anticipated that it expects "two rate cuts this fiscal." It said that the decision of the <keyword id="19913109" type="General" weightage="20" keywordseo="Monetary-Policy-Committee" source="keywords">Monetary Policy Committee</keyword> (MPC) decision to hold rates in its recent announcement was due to the elevated <keyword id="19999654" type="General" weightage="20" keywordseo="food-inflation" source="keywords">food inflation</keyword>. The climate conditions such as weather events are frequently changing and they need to be monitored. Going ahead, it anticipated that the macroeconomic environment would be better, creating a background for a rate cut. "The food challenge to a rate cut is expected to ease as agriculture prospects look better than last year. The monsoon has been above normal (7 per cent above the long period average as of August 7), and sowing has picked up across major foodgrains. As agriculture prospects become clearer by September, we expect it to pave the way for a rate cut," the S&amp;P's arm added in its report. In a move reflecting its cautious approach amid ongoing economic uncertainties, the RBI has decided to keep the <keyword id="20094323" type="General" weightage="20" keywordseo="repo-rate" source="keywords">repo rate</keyword> unchanged at 6.5 per cent. The decision to keep the repo rate steady comes amidst persistent concerns about <keyword id="19895000" type="General" weightage="20" keywordseo="inflation" source="keywords">inflation</keyword>, which remains above the RBI's target range. The central bank's commitment to bringing inflation down to its 4 per cent target continues to face challenges due to ongoing food inflation and other economic factors. Noting a likely uptick in core inflation, the report added that factors such as international freight costs, geopolitical risks to crude oil prices, and hikes in domestic telecom tariffs could affect this indicator. Anticipating the growth, it added, "The pace of growth of the economy is expected to ease this year, with lower fiscal support as the government pursues <keyword id="20101140" type="General" weightage="20" keywordseo="fiscal-consolidation" source="keywords">fiscal consolidation</keyword>." Announcing the MPC's decision on August 8, RBI Governor Shaktikanta Das expected the real Gross Domestic Product (GDP) growth of 7.2 per cent for the fiscal year 2024-25. Governor Das emphasized that the RBI remains vigilant regarding inflationary pressures and will take necessary actions to maintain price stability while supporting the country's economic recovery. The MPC's decision reflects a balanced approach, aiming to control inflation without stifling growth. The adjustments in repo rate have a direct effect on <keyword id="19900794" type="General" weightage="20" keywordseo="economic-growth" source="keywords">economic growth</keyword> and job creation. The lower interest rates tend to stimulate economic growth by making borrowing cheaper for businesses.

RBI expected to begin rate cuts in October, with two reductions this fiscal: Crisil

New Delhi [India], May 22 (ANI): Benefiting from strong sales, organised gold jewellery retailers are set to clock 17-19 per cent <keyword id="19965932" type="General" weightage="20" keywordseo="revenue-growth" source="keywords">revenue growth</keyword> in the current financial year 2024-25, according to <keyword id="19898320" type="General" weightage="20" keywordseo="Crisil" source="keywords" meta.keywordsubtype="org" meta.entityname="Crisil" meta.hostid="261" meta.entityid="Crisil">Crisil</keyword>. The rating agency asserted that the projected revenue would be driven by higher realisations stemming from elevated <keyword id="19910265" type="General" weightage="20" keywordseo="gold-prices" source="keywords">gold prices</keyword>, while volume remains steady. Gold, considered a safe haven asset for investment, has been in demand for considerable period of time, with its prices rallying to hit record highs every now and then. Geopolitical conflict in the West Asia that stretched for long now, buying by several central banks including RBI, physical demand, have altogether pushed gold prices towards northwards. Retailers are likely to step up marketing and promotional campaigns this fiscal to combat the moderation in demand amid rising gold prices, Crisil said on Wednesday. Hence, operating profitability may marginally moderate 20-40 basis points (100 basis points is equal to 1 percentage point) year-on-year to 7.7-7.9 per cent. "Working capital requirements may rise, too, resulting from increased inventory due to a substantial rise in gold prices and new stores additions. That said, credit profiles should remain stable," the rating agency noted. The organised gold sector accounts for slightly more than a third of the market, with the highly fragmented unorganised sector making up the rest. Domestic gold price increased 15 per cent during fiscal 2024 and reached Rs 67,000 per 10 gm as on end of March 2024. Now, they are trading at over Rs 74,000. Gold kept its shine as one of the safer investment options seen by various central banks across the world as well as end consumers amid geopolitical uncertainties. Gold is a scarce commodity, and any mismatch in demand-supply conditions may invariably trigger sharp price rise. Moreover, Crisil believes <keyword id="21263075" type="General" weightage="20" keywordseo="organised-retailers" source="keywords">organised retailers</keyword> will continue to gain market share at the expense of the unorganised ones, supported by changing consumer preferences and store expansion into Tier 1 and 2 cities and beyond. Himank Sharma, Director, CRISIL Ratings, "Stronger cash generation, due to healthy revenue growth and adequate profitability, will keep credit profiles of organised gold jewellery retailers stable, despite an expected rise in working capital borrowings." At the global level too, gold prices too are at their peaks. Historically, gold, as an asset, is considered to be a haven as it typically manages to retain or appreciate its underlying value in times of turbulence. (ANI)

Benefiting from strong sales, gold jewellers set for 17-19% revenue growth in 2024-25: Crisil

The Indian IT services sector is staring at a second consecutive year of muted <keyword id="19965932" type="General" weightage="20" keywordseo="revenue-growth" source="keywords">revenue growth</keyword> due to modest increase in <keyword id="21414675" type="General" weightage="20" keywordseo="tech-spends" source="keywords">tech spends</keyword> in Europe and the US, a domestic rating agency said on Wednesday. Crisil Ratings said it expects the sector to grow at 5-7 per cent in FY25, after a growth of 6 per cent estimated to have been achieved in FY24. The overall industry size is pegged at USD 250 billion and it creates over 50 lakh direct jobs. "The slowdown in technology spend will continue this fiscal, weighing on the revenue growth of IT service providers," said Aditya Jhaver, director at Crisil. The industry is, however, expected to sustain in the key metric of profitability, as the operating profit margins will be stable at 22-23 per cent, the agency said, attributing it to prudent management of <keyword id="19999266" type="General" weightage="20" keywordseo="employee-costs" source="keywords">employee costs</keyword>. Crisil said the sectoral revenues achieved a compounded annual growth rate of 12 per cent for the decade through FY24. High interest rates and economic slowdown in client markets led to a modest single-digit growth in tech spends by companies in the banking, financial services and insurance (BFSI), retail, technology and communications sectors in FY24, the agency said. It said these four sectors account for nearly two-thirds of the industry's revenues. Jhaver said revenue from BFSI and retail segments will continue to be a drag with subdued growth of 4-5 per cent in FY25. Manufacturing and healthcare, which contribute a tenth of the revenue, were the only bright spots and continued double-digit growth in tech spend given the focus on process automation and research and development-based analytics, especially in healthcare. As revenue growth remained subdued, IT service companies pulled back on addition of fresh talent, resulting in headcount reductions by 4 per cent in 2023 by top 12 companies. This, along with the decline in attrition to 13 per cent as of December 2023 from the high of 20 per cent in FY23 provided a breather by limiting higher-cost replacement hiring during FY24, it said. Associate director Joanne Gonsalves said the ratings company expects IT service providers to remain "cautious" on fresh hiring in FY25 too, which will maintain employee utilisation at a healthy level of ~85 per cent. Continued healthy cash generation, strong balance sheets and sizeable cash surplus will keep the credit quality of IT service providers stable, the rating agency said. Players will continue to eye acquisitions, especially small and mid-sized opportunities that could enhance their product baskets and increase digital capabilities, it said. An appreciation in the rupee value or sustained delay in economic revival in key markets amid ongoing geopolitical conflicts could pose downside risks, it added. SEE ALSO:<a href="https://www.businessinsider.in/tech/mobile/news/realme-narzo-70-narzo-70x-5g-smartphones-launched-in-india-starting-at-11999/articleshow/109557895.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/mobile/news/realme-narzo-70-narzo-70x-5g-smartphones-launched-in-india-starting-at-11999/articleshow/109557895.cms" target="_blank">Realme Narzo 70, Narzo 70X 5G smartphones launched in India starting at ₹11,999</a> <a href="https://www.businessinsider.in/tech/news/apple-let-loose-event-scheduled-for-may-7-ipads-expected-to-be-launched/articleshow/109553148.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/news/apple-let-loose-event-scheduled-for-may-7-ipads-expected-to-be-launched/articleshow/109553148.cms" target="_blank">Apple Let Loose event scheduled for May 7 – New iPad models expected to be launched</a><a href="https://www.businessinsider.in/tech/mobile/news/google-pixel-8a-may-be-more-expensive-than-its-predecessor-as-per-a-new-leak/articleshow/109499394.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/mobile/news/google-pixel-8a-may-be-more-expensive-than-its-predecessor-as-per-a-new-leak/articleshow/109499394.cms" target="_blank">Google Pixel 8a may be more expensive than its predecessor, as per a new leak</a>

Indian IT sector staring at 2nd straight year of muted revenue growth: Crisil

Mumbai, Revenue growth for multiplexes will slow down to 10-15 per cent in FY25 from the 20-24 per cent expected in FY24, a domestic ratings agency said on Wednesday. The profit margins will widen marginally, but will continue to be lower than the pre-pandemic levels due to the competition faced by the industry from over the top service providers like <keyword id="19897536" type="General" weightage="20" keywordseo="netflix" source="keywords">Netflix</keyword> and Amazon Prime, the report by <keyword id="19955699" type="General" weightage="20" keywordseo="crisil-ratings" source="keywords">Crisil Ratings</keyword> said. The topline will grow 10-15 per cent to Rs 7,300 crore in FY25, it estimated, adding that in FY24, the revenue growth was higher due to a slew of big-budget releases, especially from Hindi films like Gadar 2 and <keyword id="19897076" type="General" weightage="20" keywordseo="jawan" source="keywords">Jawan</keyword>, it said. The operating profit will grow by 4 percentage points to 14 per cent in FY24 on the rising revenues, and will widen further to 15 per cent in FY25, the agency said. "But that number (margins) will still be lower than the pre-pandemic level of 18-20 per cent, given the competition from Over-The-Top (OTT) content," the report said. The agency said OTT continues to benefit from high-quality and diverse content available on-tap and the competition from such platforms will keep occupancies below the pre-pandemic level going forward as well. Occupancy surged to 25 per cent in FY23 from 16 per cent in FY22, but remained below the pre-pandemic level of 30-32 per cent in FY20 amid increased penetration of OTT, it said, adding that Hindi films significantly underperformed than regional ones. "With movie producers aligning better with audience preferences and a stronger regional film pipeline, occupancies should remain at 26-28 per cent next fiscal and over the medium term," the agency's Director <keyword id="19955698" type="General" weightage="20" keywordseo="naveen-vaidyanathan" source="keywords">Naveen Vaidyanathan</keyword> said. Continued supply of high-quality movies focusing on the large-screen experience will be crucial to sustain and improve occupancy at multiplexes, the agency noted. The agency's team leader, <keyword id="20763273" type="General" weightage="20" keywordseo="shivaramakrishna-kolluri" source="keywords">Shivaramakrishna Kolluri</keyword>, however, said the slower revenue growth will take the topline to an all-time high, and attributed the same to factors such as addition of screens, rising movie ticket prices amid cost inflation and focus on premium formats. Increasing spends on refreshments following more offerings and menu revisions will also help drive the revenues, Kolluri said.

Multiplexes' revenue growth to dip to 15% in FY25 as OTTs crimp profit margins

New Delhi [India], February 26 (<keyword id="19904948" type="General" weightage="20" keywordseo="ani" source="keywords">ANI</keyword>): Passenger vehicle volume is expected to ascend to a new peak for the third straight time next financial year, growing 5-7 per cent on a high base of 6-8 per cent estimated for the current year ending March 2024, according to <keyword id="19955699" type="General" weightage="20" keywordseo="crisil-ratings" source="keywords">Crisil Ratings</keyword>. This ascend is expected as sport utility vehicles (SUVs) race ahead even as demand for cars and exports remain muted. Healthy volume growth of the SUV segment, which enjoys higher margin, will steer an improvement in operating margin to 11.5-12.5 per cent next financial year, the rating agency said on Monday. Better cash generation, along with strong balance sheet and robust liquidity will support funding of sizeable capital expenditure to set up additional capacity, keeping credit profiles of passenger vehicle makers stable, the agency said. A significant change in consumer preference has cranked up demand for SUVs leading to its market share doubling to 60 per cent of total domestic volume this fiscal from 28 per cent before the pandemic in fiscal 2019. This preference is expected to further grow backed by a healthy pipeline of new model launches across price points, including electric variants, and normalised availability of semiconductors after a prolonged period of short supply. "While the overall PV volume is seen rising 5-7 per cent next fiscal, we expect demand for SUVs to accelerate at twice the pace at over 12 per cent driven by array of feature-laden launches at competitive price points, varied technology options including hybrid and electric, and increased access to credit," said <keyword id="19898319" type="General" weightage="20" keywordseo="anuj-sethi" source="keywords">Anuj Sethi</keyword>, Senior Director, CRISIL Ratings. In contrast, demand for cars is seen slowing this fiscal too due to the ongoing weakness in the rural market and lower affordability at the entry level. The cost of vehicles has risen in the past 3-4 years as manufacturers have been passing on higher commodity prices and have had to comply with more stringent regulations on safety and emissions. The situation is similar on the exports front. The share of passenger exports is estimated to have slowed to 14 per cent this fiscal compared with 17 per cent in fiscal 2019, mainly due to inflationary headwinds and limited availability of foreign exchange in key export markets -- <keyword id="19968988" type="General" weightage="20" keywordseo="latin-america" source="keywords">Latin America</keyword>, south-east <keyword id="19915288" type="General" weightage="20" keywordseo="asia" source="keywords">Asia</keyword> and Africa -- in the past two years. "This trend is expected to continue next fiscal," Crisil Ratings said. But increasing share of SUVs with higher realisations, along with stable commodity prices and full benefit of price hikes executed last fiscal have resulted in operating margin expansion of manufacturers by 200 basis points (100 basis points is equal to 1 percentage point) to 11.0 per cent this fiscal. A further improvement in sales mix in favour of SUVs can take that number to 11.5-12.5 next fiscal, it said. (ANI)

SUVs to drive passenger vehicle volume 5-7% next financial year: Crisil

Strong <keyword id="141166" type="General" weightage="20" keywordseo="domestic-demand" source="Orion">domestic demand</keyword>, supported by government spending on infrastructure, building and construction segments, is expected to keep <keyword id="3658" type="General" weightage="20" keywordseo="india" source="Orion">India</keyword>'s <keyword id="164590" type="General" weightage="20" keywordseo="steel-imports" source="Orion">steel imports</keyword> elevated around the 6 million tonne (MT) mark this financial year even as the global <keyword id="34570" type="General" weightage="20" keywordseo="steel" source="Orion">steel</keyword> industry battles a slowdown, according to rating agency Crisil. Global steel demand, which has been subdued since the onset of the Russia-Ukraine conflict, is expected to grow 1.6 per cent in 2023 after a sharp fall of 3.3 per cent in 2022, the rating agency said in a report. Indeed, even that tepid rate of growth rides largely on a buoyant 13 per cent growth in demand in India, which has bucked the trend so far. This fiscal, the steel sector in India is poised to clock its third consecutive year of double-digit growth, at 11-13 per cent year-on-year, after growing 11.4 per cent and 13.4 per cent in fiscals 2022 and 2023, respectively. According to the rating agency, demand in <keyword id="1334" type="General" weightage="20" keywordseo="china" source="Orion">China</keyword>, the world's largest producer of the commodity, has started reviving after a three-year slump. However, oversupply has led to subdued <keyword id="6366990" type="General" weightage="20" keywordseo="prices" source="Orion">prices</keyword>. "Over the past few months, Chinese mills have been facing margin pressure, mainly due to high raw material prices and a depreciating yuan. Although the Chinese government is trying to keep demand afloat with infrastructure spending and relaxing policies on property ownership, real estate continues to be in a recessionary phase," the rating agency noted. Chinese mills have started pushing volumes into the global market at highly competitive prices. Between January and November this year, exports from China increased by 35.6 per cent to 82.7 million tonnes -- the highest since 2016. Chinese exports to India have also surged. Strong growth momentum has supported steel prices in India, and import volumes have increased significantly, driven by better realisation opportunities. As of November this fiscal, India had imported 4.26 million tonnes of finished steel, up 13.4 per cent year-on-year even as its exports declined 6.2 per cent to 4.03 million tonnes, making the country a net importer of finished steel. Among the ports, Mumbai remains the preferred destination for both alloy and non-alloy imports, accounting for 40 per cent of the total imports, followed by Mundra and Chennai. "This imbalance of volume at the ports leads to regional disparities in domestic prices. For instance, although prices of flat products corrected across India in November, the fall in trader prices was more significant in Mumbai compared with other major domestic steel markets," the rating agency noted.

Firm domestic demand to keep India's steel imports elevated in 2023-24: Crisil

India will spend nearly Rs 143 lakh crore on infrastructure between fiscals 2024 and 2030, more than twice the Rs 67 lakh crore spent in the past seven financial years starting 2017, rating agency Crisil said on Tuesday. Of the total, Rs 36.6 lakh crore will be green investments, marking a five times rise compared with the amount spent during fiscals 2017-2023, it added. "India's infrastructure spending will double to Rs 143 lakh crore between fiscals 2024 and 2030, compared with 2017-2023," Crisil said in its Infrastructure Yearbook 2023. Crisil Ltd managing director and CEO Amish Mehta said the agency expects India's gross domestic product to grow at an average 6.7% through fiscal 2031 to be the fastest-expanding large economy. "Per capita income is seen rising from USD 2,500 now to USD 4,500 by fiscal 2031, creating a middle-income country," he said, adding that this growth will be underpinned by massive all-round infrastructure development, with sharp focus on integrating sustainability." While releasing '<keyword id="19169539" type="General" weightage="20" keywordseo="crisil-infrastructure-yearbook-2023" source="Orion">CRISIL Infrastructure Yearbook 2023</keyword>', which includes a unique national index CRISIL InfraInvex, Mehta said policy interventions and a conducive investment climate have aided the uptrend in the CRISIL InfraInvex scores across sectors. "Four of these -- roads and highways, power transmission, renewable energy and ports -- have an overall score of 7-plus (out of 10), which underscores the pace of reforms and developments of the past few years," he added. The rating agency noted that the next phase of infrastructure development will be marked by growth in the average ticket size of projects and a significant number of mega-scale projects. Appropriate and consistent policy and regulatory interventions and focus on timely execution build an attractive case for various stakeholders to accelerate investments across infrastructure sectors, Crisil said. The renewable push The rating agency predicted that prominent sectors such as roads and power are expected to remain major contributors, while relatively nascent ones such as <keyword id="312660" type="General" weightage="20" keywordseo="EVs" source="Orion">EVs</keyword>, solar, wind, and hydrogen will pick up pace. "The share of EVs in India's overall automobile sales is likely to reach 30% by 2030. "Two-wheeler EV sales are expected to outpace other segments up to 2028, while demand for EV buses will be driven by state transport undertakings," it said. According to Crisil, favourable total cost of ownership and total cost of acquisition, as well as model availability for two- and three-wheelers will support EV offtake in coming years. It said the share of renewable energy in total capacity is estimated to grow 4x between fiscals 2023 and 2030. While solar will account for half of the incremental non-fossil generation, Crisil said there is a growing need to leverage emerging technologies such as 'floatovoltaics' (floating solar), offshore wind technology and green hydrogen. Noting that the hydrogen sector is poised to attract substantial investments, estimated at Rs 1.5 lakh crore between fiscals 2024 and 2030, the rating agency said mandates for green hydrogen use and incentive schemes will be important here considering the cost of production of green hydrogen is twice that of fossil-based hydrogen. Crisil said India's first sovereign green bond issuance will pave the way for the development of the domestic bond market for green issuances. Over the past few years, global experience has shown increasing appetite for green assets among investors, leading to Indian companies seeking funds in global markets, it added.

India's infra spending to ride EV, solar, wind and hydrogen push

Mumbai, The total capital outlay for roads and renewables in 2023-24 and 2024-25 is likely to jump by 35 per cent to Rs 13 lakh crore compared to that in the last two fiscal years, according to a report. Conducive policies, rising investor interest and strong execution speed are expected to drive the capital outlay in the sectors, the report by Crisil Ratings said on Tuesday. The pace of road <keyword id="34617" type="General" weightage="20" keywordseo="construction" source="Orion">construction</keyword> and capacity addition in renewables is seen growing by 25 per cent and 33 per cent, respectively, in the current and next fiscal, and the <keyword id="46930" type="General" weightage="20" keywordseo="capex" source="Orion">capex</keyword> growth is expected to sustain over the medium term, the report said. Crisil Ratings Managing Director Gurpreet Chhatwal said the pace of execution of renewable energy projects is set to increase 33 per cent to 20 GW per annum over the current and next fiscal as compared to 15 GW per annum in the past two fiscal years, supported by a healthy executable pipeline of 50 GW of projects as of March 2023. Similarly, road construction is set to improve 25 per cent to 12,500-13,000 km annually over the current and next fiscal, driven by healthy awarding of projects and step-up in execution, it said. Chhatwal said the levels at which companies are bidding for projects is a key monitorable going forward. The agency's Senior Director Manish Gupta said while the last two years have seen aggressive bidding, there are no challenges on the implementation side. Gupta said investor interest has been encouraging, with Rs 75,000-80,000 crore raised through equity and asset monetisation in the past two fiscals in both these sectors. Continued focus on asset monetisation and equity raising, along with healthy cash flows, will keep the capital structure balanced in both sectors, the report said. According to the report, despite higher capital outlays, rated renewables and road entities should have a healthy average debt service cushion of 1.2x-1.3x over the tenure of debt on their balance sheets, which supports their credit profiles. About the upcoming general elections, Gupta said the government is aware of it and is trying to finish as many projects as possible before the polls. Replying to a question on the recent slowdown in the pace of road construction, Chhatwal said every year, the pace of work is higher in the second half of the fiscal and the agency expects the same to continue this fiscal as well. The pace of road construction will increase to 34 km per day by the end of 2024-25, a 25 per cent jump over the current pace, its Chief Rating Officer Krishnan Sitaraman said. Timely asset monetisation will remain important in the roads sector as InvITs continue to grow, the report said, adding that for renewables, if geopolitical developments affect supply chains, it may impact the internal rate of return and pose a risk to estimates.

Road, renewables capex likely to rise by 35% in FY24 & FY25: Crisil

Domestic <keyword id="44023" type="General" weightage="100" keywordseo="airlines" source="Orion">airlines</keyword> industry is expected to fly back into profitability next fiscal, for the first time since the outbreak of <keyword id="8764262" type="General" weightage="20" keywordseo="covid" source="Orion">Covid</keyword>, amid easing cost pressures and reduction in leverage to support credit profiles, a report said on Wednesday. As per the report by <keyword id="15318654" type="TOPIC" weightage="60" keywordseo="Credit-Rating" source="TOPIC" sourcekeytype="mutual-fund,budget,investopedia" meta.keywordsubtype="null" meta.seopath="c/credit-rating" meta.entityname="Credit Rating" meta.hostid="153" meta.entityid="credit-rating">credit rating</keyword> agency <keyword id="6359483" type="DOMAIN" weightage="20" keywordseo="crisil" botkeyword="" source="ET" sourcekeytype="COMPANY" meta.keywordsubtype="EQ" meta.aliasname="crisil" meta.entityname="Crisil Ltd." meta.entityid="11303" meta.seoname="crisil-ltd">Crisil</keyword>, the industry is also likely to pare its net loss by as much as 75-80 per cent year-on-year to Rs 3,500-4,500 crore this fiscal, compared with around Rs 17,500 crore last fiscal. Strong recovery in passenger traffic and easing cost pressures are supporting this turnaround in operating performance of airlines, Crisil said. The projections are based on <keyword id="183985" type="General" weightage="80" keywordseo="crisil-ratings" source="Orion">Crisil Ratings</keyword> <keyword id="15319469" type="TOPIC" weightage="60" keywordseo="Analysis" source="TOPIC" sourcekeytype="mathematics,investopedia" meta.keywordsubtype="null" meta.seopath="a/analysis" meta.entityname="Analysis" meta.hostid="153" meta.entityid="analysis">analysis</keyword> of three airlines that account for around 75 per cent of domestic air traffic. Domestic and international passenger traffic recovered to 90 per cent and 98 per cent, respectively, in the nine months through December this fiscal, compared with the corresponding period of fiscal 2020 (pre-pandemic). Business and leisure travel rebounded strongly even as international scheduled services resumed, it said and added that the festival season has accelerated recovery in the second half. This pace is likely to be maintained next fiscal, as the Indian economy remains resilient in the face of global headwinds, Crisil Ratings said. The removal of fare caps is also helping airlines pass on cost increases, it added. "Next fiscal, we expect passenger traffic to cross the pre-pandemic level and pricing to remain higher by 20-25 per cent over those levels. Consequently, airlines are expected to clock 25-30 per cent <keyword id="15308831" type="TOPIC" weightage="60" keywordseo="Revenue" source="TOPIC" sourcekeytype="business,investopedia" meta.keywordsubtype="null" meta.msid="92973114" meta.seopath="r/revenue" meta.entityname="Revenue" meta.hostid="153" meta.entityid="revenue">revenue</keyword> growth next fiscal vis-a-vis pre-pandemic," said <keyword id="2458345" type="General" weightage="50" keywordseo="gautam-shahi" source="Orion">Gautam Shahi</keyword>, Director, Crisil Ratings. That along with expected moderation in average aviation turbine fuel prices will drive a significant turnaround in operational performance of airlines, enabling them to become profitable next fiscal, <keyword id="214311" type="General" weightage="20" keywordseo="shahi" source="Orion">Shahi</keyword> noted. Profitability will also be aided by lower interest costs, driven by debt reduction owing to privatisation of a large airline in the last quarter of previous fiscal, it said. Moreover, better operating performance and expected equity infusions would keep airlines' <keyword id="10926" type="DOMAIN" weightage="20" keywordseo="reliance" botkeyword="" source="ET" sourcekeytype="COMPANY" meta.keywordsubtype="EQ" meta.aliasname="reliance" meta.entityname="Reliance Industries Ltd." meta.entityid="13215" meta.seoname="reliance-industries-ltd">reliance</keyword> on debt (excluding lease liabilities) limited over the near-to-medium term. Kshitij <keyword id="6367260" type="General" weightage="50" keywordseo="jain" source="Orion">Jain</keyword>, Associate Director, Crisil Ratings, said: "The aviation sector is also likely to raise equity of Rs 8,000-10,000 crore over the next two fiscals, which will be utilised towards increasing fleet size and revamping the existing fleet." This will provide a much-needed boost to the capital structure, he said. Consequently, dependence on incremental debt (excluding lease liabilities) for airlines would remain limited over the near-to-medium term, as a major part of recent large fleet purchase orders by airlines is expected to be received from fiscal 2026 onwards, and thus support their credit profiles, according to Jain. The rating agency, however, noted that a timely infusion of equity, a debt contracted for capex towards fleet expansion and a resurgence of Covid-19 cases due to the spread of any new virus strains will remain key monitorable. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/mcdonalds-india-north-east-aims-to-hire-1500-employees-from-ngos-by-2025/articleshow/98334922.cms">McDonald's India - North &amp; East aims to hire 1500 employees from NGOs by 2025</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/tech/news/indian-tech-sector-growth-slows-in-fy23-ceos-cautiously-optimistic-nasscom/articleshow/98335133.cms">Indian tech sector growth slows in FY23, CEOs cautiously optimistic: Nasscom</a>

Domestic airlines industry expected to fly back into profitability next fiscal: Crisil

Prices of cereals are unlikely to surge as they did recently but may remain elevated well into the next financial year, according to <keyword id="183985" type="General" weightage="50" keywordseo="crisil-ratings" source="Orion">Crisil Ratings</keyword>. Climate change, strong global and rise in domestic demand contributed to the rise in wheat, a staple cereal, the rating agency said. Retail inflation in India again breached <keyword id="30067" type="General" weightage="50" keywordseo="rbi" source="Orion">RBI</keyword>'s upper tolerance band in the month of January 2023, with the Consumer Price Index pegged at 6.52 per cent. Among groups, cereals and products - which include wheat and its derivatives, eggs, and spices, among others, contributed to the elevation in retail inflation in January. In the current financial year, prices of cereals have risen significantly year-on-year in the first nine months - of wheat and paddy by 8-11 per cent, and of maize, <keyword id="626871" type="General" weightage="50" keywordseo="jowar" source="Orion">jowar</keyword> and bajra by 27-31 per cent, the <keyword id="6359483" type="General" weightage="100" keywordseo="crisil" source="Orion">Crisil</keyword> said. "The reasons are for all to see. Recent years have seen a spurt in climate-change events, like heat waves and erratic monsoons which has resulted in lower production of wheat and paddy, respectively, this fiscal," said <keyword id="13517207" type="General" weightage="50" keywordseo="pushan-sharma" source="Orion">Pushan Sharma</keyword>, Director of Research, CRISIL Market Intelligence and Analytics. "Add to this demand from global and domestic markets and the stocks of wheat and rice are estimated to be lower by 12 per cent and 35 per cent, respectively, for fiscal 2023, leading to a surge in prices of these commodities," Sharma added. On January 25, the government said FCI would offload 30 lakh tonnes of wheat from the central pool in the markets under the Open Market Sale Scheme, within the next two months, for containing the rising domestic prices of the staple foodgrain. The commencement of the e-auction of wheat in the open market to cool the staple food grain's prices has already left an impact as the government said the prices retreated over 10 per cent in the past week. Wheat, a rabi crop and in an advanced maturing stage, is expected to hit mandis in the next few weeks. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/news/how-to-use-credit-card-to-make-upi-payments/articleshow/98090488.cms">How to use credit card to make UPI payments</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/india-inc-breaks-silence-on-adani-hindenburg-row/slidelist/98093730.cms">India Inc breaks silence on Adani-Hindenburg row</a>

Cereal prices likely to remain elevated going in FY24 : Crisil

Shopping mall operators are expected to earn 7-9 per cent higher revenue during this fiscal, driven by strong retail consumption and improved rentals in their properties, according to <keyword id="6359483" type="General" weightage="80" keywordseo="crisil" source="Orion">CRISIL</keyword>. "Buoyant retail sales and improved rental yields are expected to lift the revenue of mall operators by 7-9 per cent this fiscal. That would be tantamount to around 125 per cent of pre-pandemic, or fiscal 2020, revenue," it said in a statement. The rating agency said that the growth in revenue will be on a high base of FY23. During the last fiscal, CRISIL noted that "return to social normalcy after mobility curbs were lifted led to substantial growth in footfalls and a robust 60 per cent rise in revenue to around 116 per cent of the pre-pandemic level". "Additionally, high occupancy levels, solid profitability backed by cost-optimisation measures and strong balance sheets will keep the credit risk profiles of mall operators healthy this fiscal," the agency said. CRISIL Ratings has analysed 28 malls, which have leasable space of around 18 million square feet area spread across 17 cities, with a total debt of over Rs 8,000 crore. Typically, mall operators generate around 85 per cent of their income from minimum guaranteed rentals as per lease agreements, while the rest is linked to the revenue performance of the tenants. DLF, Brigade Enterprises, Macrotech Developers (Lodha Group), Nexus Select Trust, <keyword id="144998" type="General" weightage="50" keywordseo="phoenix-mills" source="Orion">Phoenix Mills</keyword>, Lulu Group, Pacific India, <keyword id="6436174" type="General" weightage="50" keywordseo="unity-group" source="Orion">Unity Group</keyword> and Ambience Group are operating Grade A shopping malls across major cities. "The exceptional revenue growth last fiscal was on a significantly weak base. In fiscals 2021 and 2022, revenue stood at 55 per cent and 74 per cent of the pre-pandemic level, respectively, as mall operators had waived off rent and allowed flexible payment terms to tenants in a bid to prevent any major decline in occupancy," the statement said. As the impact of Covid-19 waned and occupancy increased, the average per square feet leasing rate jumped 12-14 per cent in fiscal 2023, it added. "Considering the healthy performance of the sector, capex is expected to pick up over the near to medium term. While a sizeable part of it may be funded by equity from global investors, a large debt contracted for new developments will bear watching," the agency said. On the flip side, CRISIL said that the impact of the slowdown in advanced economies, and the manifestation of the lagged effect of repo rate hikes of the past can curtail discretionary spending, including retail sales. "This aspect will, therefore, be monitorable." SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/auto/news/maruti-suzuki-fronx-vs-brezza-comparison-which-car-should-you-buy-under-10-lakh/slidelist/99729841.cms">Maruti Suzuki Fronx vs Brezza – which car should you buy under ₹10 lakh?</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/tech/news/playstation-5-special-summer-offer-discount-for-all-the-ps5-variants/articleshow/99729513.cms">This could be your last chance to grab a PlayStation 5 at a ₹5000 discount in India</a>

Shopping mall operators' revenue to rise 7-9% this fiscal: CRISIL

Continuing healthy demand from construction, real estate and automobile sectors will help the paint sector register a 10-12 per cent <keyword id="45663" type="General" weightage="20" keywordseo="revenue" source="Orion">revenue</keyword> growth this fiscal against an 18 per cent estimated rise in the just-concluded fiscal, according to a report. Volume expansion and the resultant cash generation will help <keyword id="583484" type="General" weightage="20" keywordseo="Paint-companies" source="Orion">paint companies</keyword> maintain healthy balance sheets, which will also buffer credit profiles despite the rising capex, <keyword id="6359483" type="General" weightage="100" keywordseo="crisil" source="Orion">Crisil</keyword> said in a report on Wednesday. The top five companies have announced Rs 12,000 crore capex in fiscal 2023 and 2024 on the back of Rs 7,000 crore they incurred in the previous four fiscals. New players are expected to add nearly one-third of the total existing capacity of 4.2 billion litres by fiscal 2025-end, the report added. Paint companies are likely to close <keyword id="4131553" type="General" weightage="20" keywordseo="FY23" source="Orion">FY23</keyword> with a robust 18 per cent revenue growth, primarily led by higher realisations on the back of a 6 per cent price hike during the year, along with the full impact of a 20 per cent price hike effected in the third quarter of FY22. Along with healthy volume growth, moderating crude-linked input prices will ensure operating margins to remain stable at 15-16 per cent in fiscal 2024, almost similar to the last fiscal, the agency said in the report based on the five top companies that account for 90 per cent of the Rs 65,000-crore industry or 4.2 billion litres annual capacity now. The report also said their near debt-free balance sheets will support credit risk profiles despite all major paint companies being on an aggressive capex spree. The domestic paints sector also comprises the decorative segment, which commands 80 per cent of the market. According to Anuj Sethi, a senior director at the agency, paints demand normally grows at 1.6x-2x of GDP. Decorative paints are likely to see a revenue increase of 11-12 per cent this fiscal, driven by increasing renovation/construction activity and a greater preference for branded products. On the other hand, industrial paints will see 8-9 per cent revenue growth on the back of higher government spending on infrastructure and steady demand from the automotive segment, Sethi added. Since the key raw materials are crude-linked derivatives, the 30 per cent fall in <keyword id="45185" type="General" weightage="20" keywordseo="crude-oil" source="Orion">crude oil</keyword> prices from a high of USD 115 per barrel in June-July 2022 to USD 85 per barrel now will help boost the operating margins. But this will be largely offset by higher selling expenses due to aggressive sales push and increase in ad spend by industry leaders to counter competition from new entrants. Another margin risk is the falling rupee, which the agency sees trending at 82-83 a dollar, up from 80.2 in FY2023, impacting the cost of imported materials, which account for a third of overall their raw material requirements. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/tech/news/google-chrome-alternatives-for-privacy-conscious-ios-and-android-users/articleshow/99614789.cms">These web browsers are the best alternatives to Google Chrome for privacy-conscious iOS and Android users</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/condom-maker-mankind-pharmas-4326-crore-ipo-to-open-next-week-on-april-25/articleshow/99614288.cms">Condom maker Mankind Pharma’s ₹4,326 crore IPO to open next week on April 25</a>

Paint companies to log 10-12% growth in revenue this fiscal: Crisil

<ul><li>The credit ratio is in line with the positive credit quality outlook <keyword id="6359483" type="General" weightage="20" keywordseo="crisil" source="Orion">CRISIL</keyword> Ratings had articulated earlier. </li><li>Credit ratings on nearly 80 per cent of the CRISIL Ratings portfolio was reaffirmed. </li><li>The performance of upgraded companies improved significantly over the past three fiscals, despite the pandemic. </li></ul> Debt light balance sheets, domestic demand and better cash flows has resulted in higher credit ratio during the first half of FY23, said CRISIL Ratings. According to CRISIL Ratings the corporate credit ratio (upgrades vs downgrades) continues to be high -- at 5.52 times in the first half of this fiscal (H1-FY23) - underscoring ongoing broad-based improvement in India Inc's credit quality. The credit ratio was 5.04 times in the second half of the last fiscal (H2-FY22). Three reasons stand out: 1) strengthening domestic demand, with the economy expected to grow 7.3 % this fiscal; 2) higher realisations leading to better cash flows; and 3) continuation of debt-light balance sheets as capex remains low, CRISIL Ratings said. The credit ratio is in line with the positive credit quality outlook CRISIL Ratings had articulated earlier - that upgrades will far outnumber downgrades through this fiscal. Credit ratings on nearly 80 % of the CRISIL Ratings portfolio was reaffirmed, or there was no change during H1-FY23. For the rest of the portfolio, what has changed is the upgrade rate, which increased to 16.70 %, while the downgrade rate was flattish at 3.02 %. In all, there were 569 upgrades and 103 downgrades. According to the credit rating agency, the performance of upgraded companies improved significantly over the past three fiscals despite severe pandemic-related disruptions. "Around 35 % of all upgrades were from the infrastructure sector (including large realty players). Infrastructure sector is in a unique position of largely being a domestic story and generally decoupled from the global headwinds. Here, upgrades were driven by improved operating cash flows, completion of crucial project milestones and equity infusion. Over the last few years increasing share of central counterparties in infra projects has led to more predictable payment cycles providing additional comfort to credit quality," said <keyword id="909587" type="General" weightage="80" keywordseo="gurpreet-chhatwal" source="Orion">Gurpreet Chhatwal</keyword>, Managing Director. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/stock-market/news/markets-fall-in-early-trade-on-weak-global-trends-fii-outflows/articleshow/94612214.cms">Markets fall in early trade on weak global trends, FII outflows</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/finance/news/rupee-falls-38-paise-to-81-78-against-us-dollar/articleshow/94611224.cms">Rupee falls 38 paise to 81.78 against US dollar</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/news/the-e-auction-closing-date-of-1200-gifts-given-to-pm-modi-extended/articleshow/94610736.cms">The e-auction closing date of 1,200 gifts given to PM Modi, extended</a>

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