West Asia peace deal limits India Inc’s profitability hit to 100 bps: Report

Crisil Ratings said the West Asia peace deal and reopening of the Strait of Hormuz will limit the profitability hit on India Inc to about 100 bps, roughly half of its earlier 200 bps stress-case estimate. Average operating margins are now expected at nearly 11%, with Brent crude assumed at $80-85 per barrel for this fiscal. OMCs, which incurred net under-recoveries of Rs 40,000-45,000 crore during March-May, and fertiliser manufacturers are expected to see sharp improvement, while airlines, commodity-linked sectors and diamond polishing remain under pressure.