The Union Budget for FY2019 had indicated a fiscal deficit target of 3.1% of the GDP for FY2020. However, considering the possible spill overs of subsidy from FY2019 to FY2020 and the upfronting of dividends through interim pay-outs in FY2019, we expect the fiscal deficit to be higher, at around 3.3% of the GDP.
Elections in 2019 may keep fresh project launches in check considering the uncertainties developers may face relating to timeliness of regulatory approvals for projects
The growth is expected to come from healthy volume growth in two-wheelers, commercial vehicles and tractor segment until November last year.
ICRA expects the GoI to take several steps for enhancing farmer income like ensuring crop realisation, focus on improving crop insurance scheme (Pradhan Mantri Fasal Bima Yojna, PMFBY) and allocation for development of agricultural markets.
ICRA expects the interim budget to increase capital outlay towards infrastructure sector by 12-18 percent with a major part of it going towards roads and railways
South and East India are lagging in terms of implementation and infrastructure, with registrations yet to commence in Kerala
"Driven by strong growth in medium and heavy commercial vehicles (M&HCV), along with an increase in WPI, toll collections are likely to witness a significant growth in 2019-20," ICRA said in a statement.
The decline in profitability will be primarily due to increase in the cost of funds, slowdown in portfolio growth and cost of carrying additional liquidity due to the troubles, ratings agency ICRA said.
Icra also noted that order inflows from non- infrastructure segments like industrial and real estate is expected to remain muted, with weak private sector capex growth.
The sector has reported 11.1 percent year-on-year volume growth in April-October 2019.
"For the full fiscal, FY2019, the sector is expected to grow at 10-12 percent," the ratings agency said, adding it has maintained a stable outlook for the sector for the year.
The CERC in its order on December 14, notified the draft regulations for cost-plus-based tariff determination for the next control period commencing in April 2019 up to March 2024.
The share of renewable energy in the generation mix has increased from 5.6 percent in FY2015 to 7.8 percent in FY2018.
"ICRA has given a stable outlook for the port sector, in its year-end assessment. The prospects for the Indian port sector players in the medium term are expected to be favourable, supported by continuing healthy growth in cargo of major volume drivers - Coal, Crude and Containers," the rating agency said in a statement.
The rating agency also said that expectations of lenient production curbs in China during winter months and rising steel output amid a seasonal moderation in demand have led to a steep correction in Chinese steel prices in November.
ICRA expects the current account deficit to widen sharply to USD 19-21 billion or 3 percent of GDP in Q2 (July-September) FY2019, from the modest USD 7 billion in Q2 FY2018, led by higher crude oil prices and gold imports, the credit rating agency said in a statement.
ICRA, which had earlier projected a growth of 8-9 percent, however, maintained stable outlook on domestic passenger vehicles (PVs) industry for the year.
Developers with a proven track of deliveries at the brink of recovery but uncertainties pertaining to elections, rising interest rates, funding challenges and sluggishness in overall economy persist
Official data on quarterly growth will be released at the end of this month.
Downgrading the bank, the agency said profitability of the bank will remain weak in the medium- to near- term even after the planned merger with Capital First and added that high cost wholesale liabilities are also a concern.
After the bankruptcy laws were passed in May 2016, the number of pending corporate insolvency case under the IBC rose to 816 as of the September quarter, from 723 in the June quarter, according to the Icra report.
SEBI is also planning to bring a framework on compensation for rating agencies to ensure that there is a disincentive for them to assign aggressive ratings
The concerns in the domestic market pertain to price control and mandatory genericisation, rating agency Icra said in its report, which sampled 21 firms in the industry.