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Revenues of organised <keyword id="21758362" type="General" weightage="100" keywordseo="gold-jewellery-retailers" source="keywords">gold jewellery retailers</keyword> are expected to surge by 22-25% this fiscal year, driven by the sharp reduction in import duties on <keyword id="18712" type="General" weightage="20" keywordseo="gold" source="Orion">gold</keyword> in the July Budget, according to a <keyword id="20874793" type="General" weightage="20" keywordseo="CRISIL-report" source="keywords">CRISIL report</keyword>. A recent analysis by CRISIL Ratings, which examined 58 gold jewellery retailers representing a third of the <keyword id="21165181" type="General" weightage="20" keywordseo="organised-sector" source="keywords">organised sector</keyword>'s revenues, indicates that the sector will benefit from improved <keyword id="19900859" type="General" weightage="20" keywordseo="working-capital" source="keywords">working capital</keyword> management. Although many retailers plan significant store expansions--estimated at 12-14% of existing stores--lower gold prices will reduce inventory costs, providing working capital relief. The organised jewellery sector, which accounts for just over a third of the overall market, is poised for a stronger financial performance compared to its unorganised counterpart. The steep reduction in <keyword id="20069572" type="General" weightage="20" keywordseo="import-duty" source="keywords">import duty</keyword> has come at a crucial time for the industry, as retailers prepare for the festive and marriage seasons. Following the price decline, volumes are expected to grow by 3-5% this fiscal year, reversing earlier projections of stagnant demand. Gold prices had been steadily rising since February 2024, which had subdued consumer demand and led to revenue growth driven solely by higher realisations rather than increased sales volumes. Himank Sharma, Director at CRISIL Ratings, highlighted the timely impact of the duty cut and said, "The duty cuts to their decadal lows have come at an opportune time for the gold jewellery retailers as they start stocking for the festive and marriage seasons from the latter half of August." He added, "However, the inventory losses on the existing stock due to the price cuts will be partially mitigated by the reduced spends on marketing and discounts, as demand revives. All said <keyword id="19957745" type="General" weightage="20" keywordseo="profitability" source="keywords">profitability</keyword> will see a marginal dip on-year to 7.1-7.2%." Despite the pressure on profitability, retailers' cash flows will improve due to higher revenues, enabling them to pursue expansion plans. Store expansions, expected to increase by 12-14%, will require higher inventory levels. However, the lower input costs resulting from reduced gold prices will balance out the additional working capital requirements. Gaurav Arora, Associate Director at CRISIL Ratings, added, "Gold jewellery retailers will maintain comfortable financial metrics this fiscal, with total outside liabilities to tangible net worth (TOL/TNW) and interest coverage ratios remaining around 1.0 and 9 times, respectively. These will be moderately better than our earlier expectations, keeping credit profiles stable." As the festive season approaches, gold prices remain around 17% higher than last year's average, which is expected to sustain demand and further drive revenues in the second half of the fiscal year. However, potential volatility in gold prices, changes in government regulations, and shifts in consumer sentiment will need to be closely monitored. The combination of reduced prices, increased demand, and improved working capital management is expected to keep the financial outlook for gold jewellery retailers positive, despite the slight dip in profitability. The reduced duty has caused retail gold prices to fall by Rs 4,500-5,000 per 10 grams, leading to increased demand for gold jewellery. The growth projection, 500-600 basis points higher than earlier estimates of 17-19%, is fuelled by higher volumes as more consumers are enticed by the lower prices.

Budget import duty cut will boost gold jewellery retailers' revenues by 22-25% this fiscal, notes CRISIL report

The hot temperature if persists in March may not only reduce the wheat crop yield but also heat up the commodity prices, said <keyword id="6359483" type="General" weightage="100" keywordseo="crisil" source="Orion">CRISIL</keyword>. The rabi wheat crop yield will be impacted if the temperature is high in March. The crop yield will be on a par - or marginally lesser - than last year's low, said CRISIL in a report. According to the report, in <keyword id="6357713" type="General" weightage="50" keywordseo="uttar-pradesh" source="Orion">Uttar Pradesh</keyword>, accounting for about 30 per cent of <keyword id="3658" type="General" weightage="50" keywordseo="india" source="Orion">India</keyword>'s wheat production, the eastern part is expected to have relatively good yields on-year because of timely sowing after harvest of <keyword id="50318" type="General" weightage="50" keywordseo="kharif" source="Orion">Kharif</keyword> paddy. On the other hand, western Uttar Pradesh could see a marginal decline due to late sowing - majorly in the sugarcane belt - if high temperatures persist in March. In Punjab and Haryana (together accounting for about 25 per cent of India's wheat production), late-sown wheat is in the flowering stage, while the early sown lot is in the milking stage. High temperatures are detrimental to grain formation in both these stages, CRISIL said. Similarly, in <keyword id="6355554" type="General" weightage="50" keywordseo="madhya-pradesh" source="Orion">Madhya Pradesh</keyword> (about 20 per cent of India's wheat production) late-sown wheat is at the milking stage. According to CRISIL, Bihar (about 5 per cent of India's wheat production) saw early sowing and the crop there is at the grain formation/maturation stage. Therefore, it could be impacted relatively less. Though such abiotic factors cannot be managed very effectively, farmers in Punjab, Haryana and western Uttar Pradesh are said to have initiated spraying of crop nutrients such as bio-stimulants and specialty fertilisers, which should help them cope with the heat wave to some extent. "While wheat prices have been on a downward trend in the past 20 days, if these high temperatures persist for the next 20 days, there could be a turnaround in prices," CRISIL said. SEE ALSO: <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/tech/news/indian-workers-with-digital-skills-contributing-508-billion-to-countrys-gdp/articleshow/98153304.cms">Indian workers with digital skills contributing $508 billion to country's GDP</a> <a target="_blank" class="c-link c-message_attachment__title_link" href="https://www.businessinsider.in/business/news/sell-off-by-fiis-does-not-impact-markets-retail-participation-is-more-important-says-sebi-executive-director/articleshow/98153452.cms">Sell off by FIIs does not impact markets; retail participation is more important, says SEBI executive director</a>

Hot temperature to heat up prices, reduce wheat yield: CRISIL

Mumbai, Jul 15 () Indian airlines are staring at a revenue loss of Rs 1.1-1.3 lakh crore over three financial years, including the current fiscal, due to the coronavirus pandemic which has led to visa and travel restrictions, thereby severely affecting aviation industry across the world, according to a report. Airlines are unlikely to recoup this loss as growth is not expected to return to pre-pandemic levels of double-digit increase at least in the medium term, Crisil Research said. "Indian airlines are staring at a massive Rs 1.1-1.3 lakh crore revenue forgone over fiscals 2020 to 2022 due to pandemic," the report stated. One would have assumed that the expected plunge in crude oil prices to USD 38-42 per barrel in fiscal 2021 compared with USD 64-66 per barrel in fiscal 2020 would have helped airline companies to an extent on the margin front as it forms a sizeable 30-45 per cent of an airline's cost base, it said. However, because of the outsized impact of the demand destruction, airlines are curtailing capacity deployment, thereby restricting opportunities to accrue the benefit of low crude oil prices, the report added. Airlines are projected to post losses at Ebitdar as well as Ebitda levels in fiscal 2021 as fixed costs, such as lease rentals, employee expenses and maintenance tasks, had to be met even when the airplanes were grounded, according to Crisil. Curtailed mobility of people due to the COVID-19 pandemic and related restrictions will shrink domestic air passenger traffic by 40-45 per cent and international traffic by 60-65 per cent, respectively, this fiscal, the report said. With the COVID-19 pandemic still raging in much of the world, a revival to pre-pandemic levels appears unlikely even next fiscal, it said. This is a serious jolt to the Indian domestic air travel industry that had logged double-digit growth in seven of the past ten fiscals before its fortunes took a turn for the worse with the bankruptcy and grounding of a couple of major carriers, the report added. Expecting the domestic passenger traffic to be 78-83 million this fiscal, similar to fiscal 2016, Crisil said domestic demand could see an increase in Q3/Q4 owing to the festive season, although it will still be lower on-year. Looking into fiscal 2022, Crisil does not see the traffic situation improving unless the pandemic is brought under control, it said. According to Crisil, ticket prices on domestic routes, which are currently under a fixed cap till August 24, are expected to come off from the third quarter and will on average be lower on-year this fiscal. However, air fares may rise 4-6 per cent on-year on international routes despite low passenger traffic volume. Delayed resumption of international operations is likely to translate into a steep drop in passenger numbers for fiscal 2021, which may be at fiscal 2008 level at 25-30 million, it said. While international operations are expected to resume in August (which were grounded from March 23), there is uncertainty with regard to granting of air travel permissions by different countries and because of visa application backlog, it said. The share of Indian carriers in international traffic is set to rise to 40-42 per cent in fiscals 2021 and 2022 from around 36 per cent over fiscals 2016 to 2020 as travellers are likely to prefer short to medium haul destinations owing to lower incidence of COVID-19 cases in neighbouring countries, preference for direct flights over transit through hubs and lower trip costs, which can all be served by Indian carriers, Crisil Research stated. The pandemic is bound to affect the net fleet addition of Indian carriers, which had about 900 aircraft on order as on March 31, because traffic is unlikely to rebound to even fiscal 2020 level in the medium term and fleet additions are likely to be limited to fleet replacement, with newer generation aircraft replacing older generation leased aircraft, Crisil said. IAS RVK

Indian airlines staring at Rs 1.1-1.3 lakh crore revenue loss over 3 years: Crisil

New Delhi, Feb 11 () Around 43-48 per cent of new three wheelers and up to 17 per cent of the new two wheelers sold in the country by 2024 could be electric vehicles (EVs), a report by Crisil Research said. In the four wheeler segment, however, the traction is expected to remain low with EV sales accounting for just 5 per cent of the new sales, it noted. The study looked at demand, supply and policy growth drivers for EVs such as battery costs, government subsidy and charging infrastructure, besides conducting a segment-wise analysis of the cost of acquisition and operation of EVs compared with existing internal combustion engine (ICE) vehicles, Crisil Research said. Faster adoption of two- and three-wheelers is a function of cost. Typically, electric scooters are cheaper to run compared with ICE scooters. And, e-autos are cheaper to both own and run compared with their ICE counterparts, it said. "In the context, supply will also be a critical factor for adoption. The top five electric two-wheeler manufacturers are expected to increase their capacity for electric variants from 0.4 million units in fiscal 2020 to over 3 million units by fiscal 2024," Crisil Research Director Hetal Gandhi said. In three-wheelers, even incumbent original equipment manufacturers are launching e-autos at a rapid pace, she added. At the other end, sales of personal electric cars will remain in the slow lane due to high acquisition and ownership costs in the absence of demand incentives, Crisil said. The number of cab aggregators though will increase as there will be a better operational economies and subsidies, it added. " "In the commercial vehicles space, subsidies to state transport undertakings will drive sales of electric buses for intra-city operations. That said, poor public charging infrastructure will impact adoption," Crisil Research added. MSS SHWSHW

Sales of electric two and three wheelers to see huge improvement by 2024: Crisil

Mumbai, Apr 28 () Auto sales are likely to remain muted as consumers may not flock to dealerships and even avoid shopping malls and markets due to the fear of coronavirus infection for an extended period post lockdown, a report said on Tuesday. The report by ratings agency Crisil Research projected that half of passengers vehicle sales and a third of two-wheeler volume are at risk due to the coronavirus-induced pandemic. Even if the nation-wide lockdown is lifted on May 3, resumption of normal operations at automobile dealerships would depend on whether a dealership is outside a demarcated hotspot and if it has the necessary licences from the state/ district administration to operate, the report noted. The Ministry of Home Affairs has allowed resumption of several activities from April 20, albeit by strictly adhering to social distancing norms. This covers manufacturing in industrial units, including automobile factories, under the purview of state/ district administration. In addition, the central government has directed state/ district administrations to calibrate the revocation of lockdown after demarcating districts as red (hotspots with high infection) and green (non-infected) zones. This implies that the sales outlets in red zones are likely to remain shut even if lockdown is lifted after May 3, the report said. According to Crisil, GDP growth is forecast to slow down to 1.8 per cent this fiscal, portending demand-side pressures and therefore sales of discretionary automobiles such as passenger vehicles and two-wheelers are likely to remain under pressure in the near-term. Crisil Research assessed the risk that two-wheeler and passenger vehicle industries face based on a two-factor framework – district-wise automobile sales concentration and the risk of spread of COVID-19, according to the report. "If a district that accounts for high sales of two-wheelers or passenger vehicles is also impacted severely by the pandemic, it poses a higher risk to overall industry sales," Crisil said. According to an analysis, top 100 districts account for 62 per cent of passenger vehicle sales in volume terms, with 41 per cent coming from the top 40 districts alone. In comparison, top 100 districts account for only 45 per cent two-wheeler sales and top 40 for 26 per cent, the report said. IAS MRMR

Auto sales may remain muted even after lockdown: Report

<ul><li>It’s been three years since the Insolvency and <keyword id="43550" type="EVENT" weightage="20" keywordseo="Bankruptcy">Bankruptcy</keyword> Code (<keyword id="192838" type="ORGANIZATION" weightage="20" keywordseo="IBC">IBC</keyword>) was implemented, and while progress hasn’t been as swift as expected, the results so far are still formidable. </li><li>Nearly ₹700 billion of recoveries took place in 2018-19, according to a report by <keyword id="6359483" type="COMPANY" weightage="20" keywordseo="Crisil">CRISIL</keyword>. This was twice as much as the ₹355 billion that was recovered in 2017-18 through other debt recovery schemes such as Debt Recovery Tribunal (DRT) and the SARFAESI Act. </li><li>However, the average resolution time for a case stood at 324 days, well over the maximum amount of 270 days as stipulated in the code.</li></ul> It’s been three years since the Insolvency and Bankruptcy Code (IBC) was implemented, and while progress hasn’t been as swift as expected, the results so far are still formidable. Nearly ₹700 billion of recoveries took place in 2018-19, according to a report by CRISIL. This was twice as much as the ₹355 billion that was recovered in 2017-18 through other government debt recovery schemes such as Debt Recovery Tribunal (DRT) and the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest (SARFAESI) Act. In fact, the recovery rate for 94 cases in 2018-19 was 43% and recoveries were twice as much as the overall liquidation value for assets in said cases, according to CRISIL’s President, Gurpreet Chhatwal. In comparison, the other schemes had a recovery rate of 25.2%. As a result, the build up in India’s <keyword id="142154" type="PERSON" weightage="20" keywordseo="bad-loans">bad loans</keyword> has decelerated in the recent past. CRISIL pegged the bad loan ratio at Indian banks at around 10% by the end of March 2019, compared with 11.5% at the end of March 2018. However, the report wasn’t all cheers and hurrays. CRISIL found that the average resolution time for a case stood at 324 days, well over the maximum amount of 270 days as stipulated in the code. Moreover, there are still 1,143 cases pending resolution, a third of which have been on the backburner for longer than nine months. This is likely because the <keyword id="6354457" type="ORGANIZATION" weightage="20" keywordseo="National-Company-Law-Tribunal">National Company Law Tribunal</keyword> (NCLT), the judicial authority to facilitate resolution proceedings, does not have <a href="https://www.businessinsider.in/sc-slams-govt-for-lack-of-staff-at-nclt/articleshow/68594331.cms">sufficient resources</a>. In March, India’s Supreme Court had criticised the government for inadequate staffing and delays in hiring at the NCLT. This was corroborated by <a href="https://www.moneylife.in/article/the-ibc-is-going-the-way-of-previous-failed-laws-on-bad-loan/57121.html">a report</a> by MoneyLife, which found that banks were searching for other resolution options owing to the long delays and extensive litigation under the IBC. That being said, the IBC has had its fair share of champions among India’s corporate world as well as its politicians. In <a href="https://www.facebook.com/notes/arun-jaitley/two-years-of-insolvency-and-bankruptcy-code-ibc/938314493023766/">a post</a> titled, “Two years of insolvency and Bankruptcy Code (IBC),” in early January, Arun <keyword id="6390789" type="PERSON" weightage="20" keywordseo="jaitley">Jaitley</keyword> said that as much as ₹800 billion worth of funds had been recovered following the resolution of 66 cases by the NCLT. Looking ahead to the current financial year, Jaitley expected around ₹700 billion of additional recoveries to take place. SEE ALSO: <a href="https://www.businessinsider.in/indias-finance-minister-touts-the-success-of-the-countrys-recently-implemented-bankruptcy-code-but-it-still-requires-significant-improvement/articleshow/67382165.cms">India’s finance minister touts the success of the country’s recently-implemented bankruptcy code — but it still requires significant improvement</a> <a href="https://www.businessinsider.in/sc-slams-govt-for-lack-of-staff-at-nclt/articleshow/68594331.cms">India's Supreme Court slams the government for leaving the country's bankruptcy court short-staffed</a>

Indian banks are recovering over 1.5 times as much money under the bankruptcy code —  but it's still painfully slow

Mumbai, Jun 9 () India Inc committed Rs 4,316 crore, accounting for over half of its total commitments for coronavirus relief, to the PM-CARES Fund, a report by rating agency Crisil said on Tuesday. The commitments made to the newly-created Prime Minister's Citizen Assistance and Relief in Emergency Situations (PM-CARES) Fund by 113 top corporates are more than the Rs 3,221 crore allocated to other COVID-19 related relief work, Crisil Foundation said in a report on CSR during the pandemic. Since its launch in late March after India went into a lockdown, concerns about transparency have been expressed about the PM-CARES Fund and questions raised about the need for such a platform when mechanisms to render relief with people's help already exist and also meet transparency norms. The Supreme Court had rejected a plea against the fund. Last month, the government announced that the PM-CARES Fund is allocating Rs 3,100 crore for various measures including Rs 2,000 crore for purchase of ventilators, Rs 1,000 crore for helping migrants returning to their villages from cities and Rs 100 crore to support a vaccine development. Crisil said it analysed social sector spends by 130 companies, of which 113 have pledged support either in cash or kind, it said, adding that 84 of them contributed Rs 7,537 crore which can be classified as CSR spends. Of the remaining companies, 29 contributed Rs 373 crore to other funds, facilitated voluntary donations of Rs 84 crore which will not be classified as CSR spends, it said. It can be noted that there were reports of contributions done to chief ministers' relief funds not being accounted under the CSR spends. The Crisil report said a bulk 67 per cent or 56 of the 84 entities which have spent money are from the private sector and account for two-thirds of the contributions of Rs 7,537 crore, while 24 are public sector ones which contributed 30 per cent and seven were foreign ones. Of the 84 corporates that pledged support in cash, 36 companies from Maharashtra spent Rs 4,728 crore (63 per cent), followed by National Capital Territory (NCT) of Delhi with 13 companies spending 17 per cent, while nine companies from Gujarat chipped in with 7 per cent of the Rs 7,537 crore of spends. In this set of 84 companies, 48 have spent on the COVID-19 cause at a corporate level and not at the group level, with 28 of them spending more than half of their total CSR spend of FY19 and 16 companies having spent at par with FY19 or even exceeded it, the report said. Other causes may take a back seat in FY21 as a result of the COVID-19 pandemic, the report rued. "The 'C' in CSR, the acronym for corporate social responsibility, can very well refer to COVID-19," it said. It also said that the overall CSR spending rose 14 per cent to Rs 11,392 crore in FY19, five years after it was made mandatory for companies of a certain size to allocate money for social good. Of the 4,817 listed companies, 1,976 met the criteria for mandatory CSR spending of which 1,276 actually spent, it said, adding 129 gave reasons like difficulty in identifying projects for not spending, 102 did not have any mentions in the annual reports and 150 said they were not required to spend. AA MKJ

At Rs 4,316 cr, over half of India Inc's COVID-19 spends went to PM-CARES Fund: Crisil

<ul><li>One of India's most-acclaimed film stars took the plunge into politics in early 2018 a year before the Parliamentary election in India.</li><li>In the last one year, he has been a regular in the Tamil version of the hit franchise Big Boss and started work on the sequel to Indian 2 is under production.</li><li>However, his annual revenue has fallen 20% and the annual profit after tax is down 25% in 2019 compared to a year earlier.</li></ul>One of India's most marquee personalities, Kamal Haasan, recently borrowed ₹25 crore (about $350 million) from a bank. In the process, much was revealed about his finances as his political venture is set to turn two soon. Kamal Haasan is one of India's most-acclaimed stars from the world of cinema who has three National Awards, movies in five different languages, and 59-year long career that is still waiting for the last movie. However, the prolific actor, writer, and director — whose Aalanvandhan <a href="https://indianexpress.com/article/entertainment/tamil/when-quentin-tarantino-was-inspired-by-kamal-haasan-5901680/" data-type="tilCustomLink" target="_blank">inspired the Manga scene in Quentin Tarantino's classic Kill Bill</a> — is is only two years old as a politician. Haasan took the plunge into politics in early 2018 a year before the Parliamentary election in India. Even while prepping his new-born political outfit, Makkal Needhi Maiam, for the big fight in 2019, Haasan remained a regular in the Tamil version of the hit television franchise Big Boss — <a href="https://www.businessinsider.in/entertainment/news/from-koffee-with-karan-to-big-boss-tamil-these-are-the-most-watched-indian-shows-on-hotstar-in-2019/articleshow/72467615.cms" data-type="tilCustomLink" target="_blank">one of the most-watched shows on Hotstar</a> last year. That kept the money flowing in as well as put him in people's living rooms every week ahead of the election. However, the party didn't win a single seat in Tamil Nadu but Haasan and his comrades continue to soldier on with an eye on the upcoming state assembly election in 2021. Meanwhile, Haasan also started work on the sequel to the 1996 blockbuster Indian and the movie is currently under production. As it were, while he preached that people <a href="https://www.thehindu.com/news/dont-sell-your-future-says-kamal-haasan/article5804250.ece" data-type="tilCustomLink" target="_blank">should not sell their votes for cash</a>, his annual revenue fell 20% to ₹20 crore in 2019 and the annual profit after tax went down 25% to ₹9 crore in 2019, compared to a year earlier, according to a <a href="https://www.crisil.com/mnt/winshare/Ratings/RatingList/RatingDocs/Kamal_Haasan_January_10_2020_RR.html" data-type="tilCustomLink" target="_blank">ratings report</a> released by Crisil. While rating a fresh bank loan of ₹25 crore (about $350 million) that will be payable in September 2024, the ratings agency described Haasan as "proprietorship firm with interests in directing, acting, and producing mainly involved in Tamil film industry." As a propreitorship firm is not separate from the owner, by definition. So what does the future look like for Haasan? Cash accrual is expected at ₹7 crore to ₹8 crore in the 'medium term' (usually means longer than a year), according to Crisil. However, more than half of that amount will be needed to repay debt before March 2020. In November 2019, <a href="https://www.republicworld.com/entertainment-news/bollywood-news/kamalhaasantheestimatednetworthofthechachi420actor.html" data-type="tilCustomLink" target="_blank">Haasan's net worth was estimated </a>at $100 million (₹700 crore). But according to Crisil's latest report, his debt is 1.64 times his net worth. Forbes, while ranking him at 56 in the list of India's richest celebrities, estimated his earnings for 2019 at ₹34 crore. By that metric, Haasan's net worth will be about ₹15 crore, assuming there are no loans other than one mentioned in the report. Attempts to reach out to Crisil for clarification on the disparity failed. The story will be updated with Crisil's response, if any. The good news is that he makes 12 times more money every year than what is required to cover the interest. On the other hand, "volatility in profitability and revenue, inherent in the film industry, will continue to impact the firm, since the income is based on the ongoing films and other programmes," according to Crisil. SEE ALSO: 
 
 
 
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Kamal Haasan's ₹25 crore loan revealed a lot about his finances after nearly 2 years in politics

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

New Delhi, Nov 18 () Some "cracks" have surfaced on the highways on hybrid annuity model (HAM) with smaller developers finding financial closure of projects tough, rating agency Crisil said on Monday.
 Launched in early 2016, the model had expedited road construction schemes and resulted in execution of a large number of projects.
 "In the past three-and-a-half years, the HAM of road construction has grown substantially, but some warts are now showing up: smaller developers are finding financial closure elusive, and over-aged projects awaiting appointed dates are facing termination risk," CRISIL said in its research report.
 Crisil Research's analysis of road projects under the National Highways Authority of India (NHAI) showed that HAM has expanded its network since its launch in February 2016.
 "Over fiscals 2017 to 2019, HAM projects accounted for a quarter of the executed road projects and 45-50 per cent of the projects awarded," said the report titled 'HAM paves ahead, but cracks appear too'.
 The report said a deep-dive project-by-project analysis by Crisil Research shows that of the 6,670-km HAM projects awarded by the NHAI during financial years 2016 to 2019, a good 70-75 per cent have achieved financial closure, most of them by large developers with a turnover of over Rs 1,500 crore.
 However, it said the smaller developers have started to face problems.
 "Though the foundation has been laid, some cracks have surfaced on the HAM highway. The smaller developers, many of which have changed lanes from engineering, procurement and execution (EPC) projects to HAM for the first time, are struggling to secure funding after bidding aggressively, and banks tightening capital requirements," it said.
 It said the upshot has been a deceleration in the pace of financial closures.
 For fast-track highway projects, reviving the public-private partnership mode and attracting more investments in the sector, the government had approved HAM under which it provides 40 per cent of the project cost to the developer to start work while the remaining investment is made by the developer. NAM HRS

HAM grows substantially in over 3 years, but some cracks are now surfacing on highways: Crisil

Mumbai, The <keyword id="89466" type="General" weightage="20" keywordseo="Tea-Industry" source="Orion">tea industry</keyword> is likely to witness an 8 per cent year-on-year decline this fiscal due to decreasing export volume following the rise in supply from Sri Lanka, a report said on Friday. The operating profitability of the industry will fall for the second year in a row, shedding 100 basis points (bps) to 5 per cent due to lower realisation, Crisil Ratings said in a report. Profitability had fallen 150 bps last fiscal, primarily because of an increase in wages, the report said, adding that in FY23, wages that constitute 20 per cent of total input cost were hiked by 15 per cent. However, low leverage and negligible capital expenditure (capex) will keep credit profiles stable, the report stated. The tea industry will report 8 per cent year-on-year degrowth in revenue this fiscal, led by a decline in export volume, the agency said. "Domestic demand, which accounts for 82 per cent of sales volume, should remain steady at 1,100 million kg this fiscal. However, exports, which make up 18 per cent by volume and 30 per cent by value, may slide 12 per cent year-on-year to 200 million kg. Last fiscal, the export volume had increased 14 per cent due to lower production in Sri Lanka, a major tea exporting country," Crisil Ratings Director Nitin Kansal said. India, with a share of 11 per cent, is the fourth-largest tea exporter after China, Kenya and Sri Lanka. This fiscal, increased supply of Sri Lankan tea will impact demand for Indian produce as their production is expected to rebound following better availability of fertilisers and pesticides, said the report. Sri Lanka predominantly produces orthodox tea, which sees good demand globally because of its quality, and the country accounts for 50 per cent of the global trade. This will lower the realisation of Indian <keyword id="548344" type="General" weightage="20" keywordseo="tea-companies" source="Orion">tea companies</keyword>, with domestic production seen stable at 1,350 million kg this fiscal. The consequent decline in operating profitability will reduce cash accrual by 40 per cent this fiscal, the Crisil Ratings report noted. "Low capex intensity and stable working capital cycles will keep borrowings under control. So, the capital structure of tea companies would remain stable, with gearing expected below 0.50 times as of March 31, 2024, in line with the historical trend. Healthy balance sheets will ensure comfortable debt protection metrics, lending stability to credit profiles," Crisil Ratings Associate Director Argha Chanda said. Hence, despite weak operating performance, interest coverage will remain over 3 times this fiscal, it added.

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