ANI
07 Jul 2025, 09:01 GMT+10
New Delhi [India], July 7 (ANI): Corporate revenue growth in India may face a slowdown in the coming financial year due to weaker nominal GDP growth, according to a recent report by Jefferies.
The report estimates that India's nominal GDP growth is likely to ease to 9 per cent in FY26. This would be the second-lowest pace since FY04, excluding the pandemic-hit FY21.
The slowdown in nominal GDP growth is expected, despite stable real GDP growth of 6.5 per cent, mainly due to lower inflation, which is weighing down overall nominal growth.
Jefferies stated that a softer nominal GDP growth could affect several key economic indicators, including corporate revenues and credit growth.
It said 'Don't expect corporate revenue growth to bounce materially in FY26,' adding that weaker nominal variables may also drag down earnings momentum.
The report also highlighted that credit growth in the country, which generally moves in line with nominal GDP, is already showing signs of moderation.
While the Reserve Bank of India (RBI) is likely to maintain a pro-growth stance to support bank lending, Jefferies does not expect bank credit growth to rise beyond 11-12 per cent by March 2026.
The report also pointed out that 9 per cent nominal GDP growth in FY26 would be the lowest since FY20. It noted that India's nominal GDP growth is expected to decline by 1 percentage point year-on-year, reaching a six-year low of 9%.
Historically, since FY04, nominal GDP growth has fallen below 10 per cent only once, in FY20, when it grew by just 6.4 per cent. That year, real GDP had grown at 3.9 per cent and the GDP deflator was around 2.5 per cent.
On average, India's nominal GDP growth between FY04 and FY25 has been about 12.6 per cent. The report suggested that a decline from that average could indicate a period of slower earnings and limited credit expansion, affecting business growth and financial sector momentum. (ANI)
Get a daily dose of Business Sun news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Business Sun.
More InformationMILAN, Italy: Italian regulators have flagged four non-EU countries—including Russia—as carrying systemic financial risk for domestic...
NEW YORK CITY, New York: With just weeks to spare before a potential government default, U.S. lawmakers passed a sweeping tax and spending...
REDMOND, Washington: Microsoft is the latest tech giant to announce significant job cuts, as the financial strain of building next-generation...
LONDON UK - U.S. stock markets were closed on Friday for Independence Day. Global Forex Markets Wrap Up Friday with Greeback Comeback...
SANTA CLARA, California: Nvidia came within a whisker of making financial history on July 3, briefly surpassing Apple's all-time market...
SACRAMENTO, California: California's multibillion-dollar farms are facing a growing crisis—not from drought or pests, but from a sudden...
PALO ALTO/TEL AVIV: The battle for top AI talent has claimed another high-profile casualty—this time at Safe Superintelligence (SSI),...
REDMOND, Washington: Microsoft is the latest tech giant to announce significant job cuts, as the financial strain of building next-generation...
SANTA CLARA, California: Nvidia came within a whisker of making financial history on July 3, briefly surpassing Apple's all-time market...
SAN FRANCISCO, California: Grammarly is doubling down on AI-powered productivity tools with the acquisition of Superhuman, a sleek...
Bengaluru (Karnataka) [India], July 5 (ANI): Union Minister of Commerce and Industry Piyush Goyal, during an interactive session with...
Pauline Wahura's public school, nestled in the rolling plains of southern Kenya's Kajiado County, may seem unnoticeable at first glance....