40% MSMEs unaffected by Covid pandemic; 25% lost over 3% market share: CRISIL
New Delhi, June 27 (KNN) During the last fiscal year over one fourth of Indian MSMEs lost over 3 per cent market share due to the covid-19 pandemic, as per CRISIL Research’s SME Report 2022.
Because of a sharp rise in commodity prices in FY22 compared with pre-pandemic levels, half of the MSMEs saw their earnings before interest, tax, depreciation and amortisation (Ebitda) margins contract, said the report.
The report by the rating agency covered 69 sectors and 147 clusters that logged aggregate revenue of Rs 47 lakh crore, representing 20-25 per cent of the gross domestic product (implying two-thirds coverage of the MSME universe).
“Interestingly, 40 per cent of the SMEs hardly lost market share because of their ‘essential’ nature, such as pharmaceuticals, agricultural millers, or by virtue of them commanding a high share, such as the brass industry," said Pushan Sharma, director, CRISIL Research.
Few sectors where only SMEs could capitalise on revival in infrastructure demand gained share such as steel pig iron.
Tobacco processing SMEs, which largely sell loose tobacco and bidi, gained market share as a majority of tobacco selling points remained closed due to health concerns.
CRISIL expects transport operators, edible oil, gems and jewellery to be the most vulnerable to Ebitda losses owing to wafer thin margin of <3 per cent and limited input cost pass-through of under 60 per cent. (KNN Bureau)