Archive · 1 Oct 2025
Indian Corporate Credit Quality Resilient Despite Headwinds
Imagine companies in India are doing pretty well overall, even though things are a bit tricky right now.
Some businesses are getting more loans and are doing better, especially in construction.
But some exporters are facing problems because the US put extra taxes on their products.
This means some businesses might not make as much money.
Banks are expected to continue to lend money, but some smaller businesses might be a little risky to lend to.
Indian corporate credit quality remained resilient in H1 FY26.
Infrastructure and construction sectors saw the most upgrades.
US tariffs are negatively impacting export-linked sectors.
Financial services showed mixed results with banks stable but some NBFCs facing stress.
Credit growth expected to pick up in the second half of the year.
- Who
- Multiple Credit Rating Agencies
- What
- Report on Indian corporate credit quality in H1 FY26
- When
- H1 FY26
- Where
- India
- Why
- To assess the financial health of Indian corporates
Positive Outlook
Challenges Ahead
Credit Quality
Positive Outlook
Credit quality remains generally stable, with upgrades exceeding downgrades in some sectors.
Challenges Ahead
US tariffs and potential demand uncertainties pose risks to specific sectors and overall export performance.
- Reporting Period
- H1 FY26
- Upgrade Rate (Crisil)
- 14%
- Downgrade Rate (Crisil)
- 6.4%
- US Export Impact
- Potentially 4-5% YoY contraction in merchandise exports
- Bank Credit Growth (FY26)
- 10.4-11.3%
- NBFC Loan Growth (FY26)
- 15-17%
Sources
India Inc. Holds Firm – Can It Navigate Global Turbulence Ahead?
Indian corporate credit stays resilient, but export sectors and NBFCs face pressure: Rating Agencies
Bank credit to MSMEs, NBFCs rises in August