Count Credit Risk Among Your Foes

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Count Credit Risk Among Your Foes
Nilanjan Dey - 29 October 2021
Like an aria that loses its way in a parched wilderness, a good credit rating gets smothered by the overpowering impact of the many bad ones that typically surround it. Welcome to the world of creditworthiness (or the general lack of it), a theatre of war where a battle between haves and have-nots rages fiercely. As recent events in the corporate sector reveal, not all seems to be well on the credit front. Witness the trouble that is believed to be brewing in various corners of the market, cutting across sectoral divides and inviting questions from distraught investors. Credit risk is a constantly fluttering red flag for the market, as seasoned players will no doubt admit. The arrival of Covid, leading to constricted supply lines and followed by a host of related problems, has impacted many segments of the economy. A number of sectors are facing huge challenges even as you read this. Overall, inflation numbers do not look too healthy, a trend that has been fortified by the most recent acceleration in fuel prices, not to mention that of other commodities. In sum, these eat into...
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