ICRA expects India’s power demand to grow 5.0–5.5% in FY27, driven by industrial, commercial, agricultural and household consumption. New demand pockets from electric vehicles and data centers are also set to play a role, while thermal plant usage is expected to remain stable. But distribution companies may struggle with high debt and limited tariff increases, pressuring profitability.
ICRA warns Indian oil companies may face LPG under-recoveries climbing to as much as Rs 80,000 crore by FY2027. Disruptions from West Asia and persistently high global prices are squeezing margins, while fertiliser costs are rising sharply and adding pressure on government subsidies. The knock-on effect could extend to chemical, gas and other downstream sectors next fiscal year.
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ICRA warns that the West Asia crisis is already squeezing fuel economics for Indian OMCs. With crude at $120–125 per barrel, marketing margins are estimated at about negative Rs 14 per litre for petrol and Rs 18 for diesel. If crude rises by $1 and retail prices don’t change, fuel marketing losses increase by roughly 60 paise per litre.
ICRA has downgraded Ola Electric Technologies, citing declining sales, persistent losses, and delayed profitability. While the company worked on improving unit economics, intensifying competition and subsidy rationalisation pressured demand and margins. Ola Electric’s electric two-wheeler market share has also fallen, with legacy players increasingly dominating the segment.
ICRA expects India’s passenger vehicle growth to moderate to 4–6% in FY27 after a strong FY26, citing a high base alongside macro risks and a potentially weak monsoon. Demand is still expected to hold up due to GST-related support and fresh vehicle launches. Utility vehicles are forecast to keep leading sales, while exports have risen meaningfully.
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