Recently, the Reserve Bank of India (RBI) released data for fluctuations in costs, operating profits, and EBITDA of listed private Indian corporates in Q2 FY 2023 (July to Sep 2022) and compared it with earlier quarters beginning Q1 FY 2022.
When you look at the fluctuation in raw material, power and fuel, and interest costs for listed companies since Q1 2021-22, you can see what a roller coaster ride it has been!!
Inflation in raw material, power, and fuel costs, combined with rising interest rates, contributed to the de-growth in Operating Profits and EBITDA in Q2 FY 2023.
With inflation running higher than the RBI’s upper tolerance band, and the rest of the world languishing in the economic doldrums, RBI downgraded its GDP growth forecast for India for FY2023 to 6.8% from the 7.2% it had predicted in April this year.
In this tough environment, corporates will need to manage credit risk well so as to not lose any money on bad or doubtful debts.
Is your credit risk management plan in place? Are you using a credit scoring and decisioning model and an early warning system (EWS) to make crucial credit decisions related to your customers, distributors and dealers? Better late than never!
Please reach out to Rubix to meet your credit risk management needs.
Phone: +91-22 4974 4274