Moody's Ratings, a credit rating agency, revealed several important and impactful things on Tuesday. It said that Indian companies will invest 45 to 50 billion dollars annually in capital expenditure in the next one to two years to increase capacity. India's most valuable company, Reliance Industries, led by Mukesh Ambani, will reportedly have a 30 percent share in this expenditure. Moody's has released a report on companies operating in India and Indonesia. It said that investments will be made to increase production chain integration and achieve the target of net zero carbon emissions.
According to the report, "In the next one to two years, the annual capital expenditure of rated Indian companies will be around $45 to $50 billion (Rs 3 to 4 lakh crore). Reliance Industries alone will have a 30 percent share in this. The company has earmarked about $15 billion (over Rs 1.2 lakh crore) for investment in various businesses."
According to the report, the oil-gas sector and Reliance Industries together will account for more than 60 percent of the total expenditure of Indian companies in a year or two.
Moody's report said that the seven rated oil and gas companies in India will account for about 30 percent of the total investment. These companies will spend about $15 billion annually to expand existing capacity and invest in the green energy sector to reduce carbon emissions.
Citing examples, Moody's Ratings said ONGC and Indian Oil will spend $6 billion and $4 billion respectively over the next two years on reserve building, and distribution activities i.e. supply chain integration and energy transition.
Moody's said that the debt quality for Indian and Indonesian companies will remain good. India and Indonesia are the two largest emerging economies in Asia, excluding China. Among the emerging economies, both the G-20 countries have the highest number of rated companies and the amount of rated debt.
Moody's said that India's GDP growth rate is expected to be more than six percent in the next two years. Domestic demand will play an important role in accelerating India's economic growth.
Moody's Ratings expects the earnings of rated Indian companies to grow by five percent in the next one to two years. Companies will benefit from broad growth in various sectors including metals, mining and steel, telecom, and automobile companies.
