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Demand for industrial credit from corporates with capex plans likely to remain muted: Ind-Ra
Apr-25-2024

Credit rating agency, India Ratings and Research (Ind-Ra) in its latest report has said that the demand for industrial credit from corporates with capex plans is expected to remain muted, due to strong cash flows, modular nature of investments and flexibility to tap equity markets. 

The report noted that consequently, financial leverage is likely to remain muted and a meaningful increase in the credit requirements of banks/capital markets will be largely driven by movements in working capital cycles and/or potential inorganic opportunities. 

As per the agency, this could keep credit spreads tighter than historical levels and expose the system to mispricing of risk. The agency has estimated banking system credit growth of around 15% year on year (y-o-y) for FY25 in its ‘FY25 Outlook: Banks’.


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