6% growth in corporate revenue in FY’22
India Ratings has revised its earlier assumption of 4.4% growth in corporate revenue this fiscal to an overall 6% median revenue growth over FY20. While the second wave of the pandemic is disrupting supply chains for most industries, the firm has revised its forecast upwards as the situation was worse last year when half of the year was almost lost in lockdowns. The report, however, said that supply chain disruptions are hindering their recovery beyond the current fiscal.
India Ratings noted that the service-oriented sector is the worst hit so far in terms of the supply-side disruption from the second wave of the pandemic. The study mentioned that elevated prices and pent-up demand have worked in favour of most firms leading to higher volume growth. It added, though that volatile commodity prices along with interest rates reversal and the rupee fall are likely to limit profit margins.
The report speculated that sectors like pharma, chemicals, cement and steel may witness some capex on account of higher liquidity cushion. It expects logistics and ports are likely to see growth on account of expectation of strong GDP growth and IT and paper sectors are likely to witness an improvement due to higher demand.