Stimulus to Ease Funding Burden for India’s Weakest Firms
- Lower-rated rupee debt spreads have declined from 11-year high
- India policy steps buffered pandemic’s impact on smaller firms
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India’s weaker borrowers are facing a record amount of local-currency bonds coming due this quarter, but unprecedented stimulus steps may mean they are better equipped to pay back their debt than in the past.
Local companies ranked below AA+ need to repay a total of 383 billion rupees ($5.1 billion) of notes in the July-September period, the highest ever, according to Bloomberg-compiled data. Fundraising has become much cheaper for the firms though, after cash infusions of about $50 billion by the country’s central bank and a $277 billion rescue package for the economy by the government.