Top headlines: Extra re-payment burden for India Inc, weak PV sales, & more

India’s top listed companies now have higher debt, while profitability, accumulated earnings, and cash reserves are much lower than what they were on the eve of the Lehman crisis.
India Inc is staring at an extra repayment burden on its overseas loans as fund raising from abroad fell to $5 billion in the first quarter of 2020 . The two-wheeler sales saw a decline of 39.83 per cent at 866,849 units in March 2020. Here are the events which made it to the business headlines today:

Covid-19 lockdown: 12-hr workday in Rajasthan factories, Punjab may follow

As industries prepare to restart operations in a staggered manner in the second phase of the lockdown, the Rajasthan government has extended working hours at factories from a maximum of 8 hours to 12 hours a day to ensure production doesn’t take a hit with a limited workforce. The template is set to be followed by other states such as Punjab. Read more here

India Inc leans less on foreign debt as weak rupee makes servicing costlier

Fund raising from abroad fell to $5 billion in the first quarter of calendar 2020 from $8.8 billion raised by Indian companies in the same period of 2019, with companies taking steps to cut risk due to the Coronavirus pandemic. Read more here

Covid-19 impact: March meltdown sees PMS returns dropping by up to 41%

The equity market sell-off has taken a heavy toll on the performance of portfolio management services or PMS strategies that cater to high net worth investors (HNIs), with 147 such offerings showing 3-41 per cent a decline in returns in March. Read more here

Coronavirus outbreak: Passenger vehicle sales plunge 51% in March

Passenger vehicle sales in India declined by a whopping 51 per cent in March as the 21-day lockdown forced people to stay indoors.

“The automobile industry witnessed one of its sharpest declines in domestic sales in March 2020 due to the subdued demand and weak consumer sentiment. This was further aggravated by the Covid-19 outbreak in the country,” said Rajesh Menon, director general at the Society of Indian Automobile Manufacturers (Siam). Read more here

Covid-19 lockdown: India Inc more vulnerable now than in recession of 2008

Corporate India now has a much lower financial capacity to absorb large losses, which are arising out of the Covid-19 lockdown, than in 2008, when the global financial crisis struck.

India’s top listed companies now have higher debt, while profitability, accumulated earnings, and cash reserves are much lower than what they were on the eve of the Lehman crisis. Read more here

Covid-19 forces retailers to reassess volume-driven business strategy

Social distancing will now acquire significant importance in the retail manuals of all companies, said apex industry bodies on Monday, implying the focus will move away from a ‘volume-driven business strategy’ that has underpinned organised retail for over two decades now. Read more here

Under Rs 18,000 crore loss, power discoms looking at a bleak future

State-owned power distribution companies (discoms) are looking at a bleak future in the near term as funding and revenue sources have dried up. Buried under losses of Rs 18,000 crore, with lenders shying to fund them, turnaround of discoms could be a long shot now. Read more here

Working capacity at 25% may be unviable as industry awaits end of lockdown

Amid concerns in some sectors, like auto, that a staggered opening up of manufacturing capacity to about 25 per cent could be unviable, broad swathes of the industry are readying strategies after the possible partial lifting of lockdown post April 14. Read more here

Logistics costs set to rise as freighters hike tariffs 

As transporters grapple with regulatory challanges and manpower shortage, freight operators are adding surcharges for transportation of goods. This may increase logistics costs for companies and products as well, the Economic Times reported.

FMCG majors eye capacity ramp-up as ground situation improves

 
FMCG majors are hoping to ramp up capacities this week onwards as they still struggle with supply disruptions. The capacity ramp-up they expect could vary between 35 and 50 per cent depending on product lines, The Hindu Businessline said in a report.


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