"This publication highlights Moody's broader initiatives to deepen and expand our analyses on India-related topics, including the sovereign and sub-sovereign, and corporate finance and financial institutions," says Philipp Lotter, a Moody's Managing Director.
Last week, Moody's published its 2015 outlook for Indian non-financial corporates, which is stable and driven by economic recovery and political stability. The outlook reflects Moody's expectation for fundamental business conditions in the sector over the next 12 to 18 months.
"We changed the outlook for Indian non-financial corporates to stable from negative, reflecting our view that economic recovery, enhanced access to the global capital markets and successful implementation of pro-market policies will lead to improved corporate cash flows and be broadly supportive of business growth," says Vikas Halan, a Moody's Vice President and Senior Credit Officer.
Improved external vulnerability should also reduce foreign-exchange risk for Indian corporates, despite gradual interest rate normalization by the US Federal Reserve.
"We expect 5.6% GDP growth in India (Baa3 stable) for the fiscal year ending March 2016, led by an acceleration in manufacturing activity," adds Halan.
Moreover, Foreign direct investment (FDI) inflows into India have increased significantly since April 2014.
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"This trend of increasing FDI is set to continue over the coming quarters on the back of the country's pro-growth policy agenda and favourable economic environment when compared to other major emerging markets," says Rahul Ghosh, a Moody's Vice President and Senior Research Analyst.
"Greater FDI inflows will, in turn, provide more stable funding for India's current account deficit, thereby reducing the economy's exposure to external headwinds," adds Ghosh.
In this first edition of the newsletter, Moody's also examines the ongoing increase in foreign currency bond issuance.
"We expect cross-border bond issues from both Indian non-financial firms and financial institutions to increase through 2015, as an improved economic outlook for the country has increased investor appetite for Indian credits, and as regulatory changes make it easier for Indian companies to borrow in foreign currency," says Halan.
The inaugural edition of Inside India contains the following analyses:
Rising FDI to Help Alleviate India's External Vulnerabilities
2015 Outlook - Indian Non-Financial Corporates: Improving Operating Environment Drives Stable Outlook for Indian Non-Financial Corporates
Foreign Currency Bond Issuance by Indian Entities Will Continue Increasing
India Banking System Outlook Remains Negative
Energy Reforms Are Credit Positive for the Sovereign, Oil and Gas Companies and Natural Gas Producers
Indian Pharmaceutical Companies: Growth Prospects and Stronger Business Profiles, But Leverage to Rise
India's Growth Recovery to Bolster Tax Revenues and Capital Inflows, Supports Credit Quality
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