India’s TOP 500 Companies 2020

INDIA’S TOP 500 COMPANIES 2020 86 The Indian economy had shown resilience in FY19 backed by some revival in private consumption and investment demand. The growthmomentumhowever faltered as the economy entered FY20 with sluggishness being witnessed on both demand and investment fronts. The implementation of nationwide lockdown since March 25, 2020 consequent to the pandemic that halted economic activities in both industry and services sectors aggravated the downfall. The initial supply-side shocks had ripple effects on consumption and investment demand and the overall confidence level. D&B’s Business Optimism Index for June 2020 exhibited the lowest level of optimism in last 18 years for net sales & new orders. The Impact of COVID-19 that started as a supply shock, also triggered strong demand shocks •Na � onwide lockdown & social distancing •Reverse migra � on of labour •Morbidity due to virus •Disrup � on in supply chains Supply shock •Reduced consump � on demand due to wage/ income loss and increased precau � onary savings •Reduced investment demand due to higher uncertainty about future & lower capacity u �li sa � on Demand shock •67% y-o-y contrac � on in IIP in April 2020 •In April 2020, PMI manufacturing declined to 27.4, while PMI services fell to an all � me low of 5.4 •Exports fell 60.2% y-o-y in April 2020, while import fell 59.6% y-o-y Economic Impact Source: Ministry of Finance & D&B Research Indian Economy had entered downward spiral even before COVID-19 struck; with India’s GDP growth moderating from 7.1% y-o-y in Q1 FY19 to 5.2% in Q1 FY20 and further downwards to 2.3% in Q4 FY20 Indian economy slowing down even before COVID-19 struck Faltering IIP growth points toward slowing Indian economy -2 0 2 4 6 8 10 12 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Q1 FY19 Q2 FY19 Q3 FY19 Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 % total GVA Industry Servi ces -8 -6 -4 -2 0 2 4 6 8 Q1 FY19 Q2 FY19 Q3 FY19 Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 % growth Manufacturing I IP General IIP Source: MOSPI Economy Update Dun & Bradstreet