Home Hotel industry Moratorium, ECLGS has helped the reception units but the continued upturn in...

Moratorium, ECLGS has helped the reception units but the continued upturn in demand remains to be seen: ICRA

2
0
The sector, which has a number of MSMEs and small businesses, has recovered at a ‘faster pace’ after the second wave from the 2020 foreclosure due to the easing of restrictions in the second quarter of the year. Exercise 22. (Representative image)

Credit and financing for MSMEs: The moratorium and the ECLGS emergency credit program had provided much needed financial support during Covid-19 to the hotel industry even as the continued upturn in demand in recent months remains to be seen as the impact of a possible third wave cannot be ruled out, according to the ICRA rating agency. About 70% of the companies in the agency’s hotel portfolio had used a moratorium during the first wave of the pandemic last year, although this was only 39% of the rated debt.

ICRA said it continued to have a negative view of the Indian hotel industry, “as the continued recovery in demand over the past few months remains to be seen. A potential third wave and its impact on travel and hotel occupancy cannot be ruled out. Additionally, Revenue Per Available Room (RevPAR) is still significantly lower than pre-Covid levels. About 63 percent of CIFAR ratings are also on a negative outlook right now, “CIFAR said in a recent statement. The industry had raised around Rs 660 crore of equity in FY 2021 and announced Rs 3,300 crore of equity / fundraising plans in FY 2022.

The sector, which has a number of MSMEs and small businesses, has recovered at a ‘faster pace’ after the second wave from the 2020 foreclosure due to the easing of restrictions in the second quarter of the year. FY22. While the partial lockdown, along with travel restrictions in many states in April and May 2021 as a result of Covid 2.0, led the ICRA sample of companies to report a 56% drop quarter-over-quarter revenue, in line with ratings The agency’s estimates, however, said the agency said revenue is expected to improve 85 to 90 percent sequentially in the second quarter of the year. recently concluded fiscal year 2022.

Subscribe now to the Financial Express PME newsletter:Your weekly dose of news, perspectives and updates from the world of micro, small and medium businesses

“Demand in recent months has come from vacations, weddings, and trips to recreational destinations within driving distance, as well as special purpose groups. There’s the new cookie trend (which runs from a resort town) picking up. The collection of business trips was mainly carried out on project sites / manufacturing sites in specific sectors. The demand related to Covid, which prevailed from mid-April to mid-June, decreased from July and we are seeing an increase in real demand, ”said Vinutaa S, assistant vice president and area head, ICRA Limited.

In March of this year, the Ministry of Finance had extended the ECLGS program to cover companies in the hospitality, travel and tourism, leisure and sport sectors which had, as of February 29, 2020, a total outstanding loan up to Rs 500 crore and arrears, if any, for 60 days or less, on that date. The program, which is aimed primarily at MSMEs, has now been extended until March next year. ECLGS loans of more than 2.86 lakh crore rupees were sanctioned on September 24, 2021, while of the total guarantees issued, around 95% were for sanctioned loans to MSME, the ministry said in its statement on Wednesday. .

It is important to note that companies in the hospitality, travel and tourism, leisure and sports sectors, which had not previously benefited from ECLGS, can now benefit from credit support up to at 40% of their outstanding credit at March 31, 2021, up to a maximum of Rs 200 crore per borrower, according to the changes announced by the ministry in the diagram on Wednesday.

Get live stock quotes for BSE, NSE, US market and latest net asset value, mutual fund portfolio, see the latest IPO news, top IPOs, calculate your tax Using the income tax calculator, know the best winners, the best losers and the best equity funds in the market. Like us on Facebook and follow us on Twitter.

Financial Express is now on Telegram. Click here to join our channel and stay up to date with the latest news and updates from Biz.



Source link

LEAVE A REPLY

Please enter your comment!
Please enter your name here