India Risk Climate:  Rubix Data Sciences Private Limited Report Indicates a Huge Improvement in the Indian Risk Environment

The Rubix Quarterly Risk Transition Report for #India for Q2 FY 2022 (July – Sep 2021) indicates a huge improvement in the #risk environment as compared with Q1 FY 2022. This can be attributed to the resurgence in economic activity after the lifting of Covid restrictions imposed by the Government. The uptick in vaccinations and normal monsoon are driving consumption which augurs well for #economicgrowth in India.

Some key findings:

• The GST Quarterly Monitoring Report is prepared basis 10,973 firms from more than 35 sectors of the Indian economy:
  • The Rubix GST Compliance Score of only 7% of the total number of firms being monitored deteriorated in Q2 FY 2022 compared with 32% in Q1 FY 2022.
  • In all the quarters since Q4 FY 2020, the Rubix GST Compliance Score has deteriorated in a higher percentage of firms than 7% recorded in Q2 FY 2022.
• The #ProvidentFund (PF) Quarterly Monitoring Report is prepared for 4,335 firms:
  •  The Rubix PF Compliance Score of only 20% of the firms deteriorated in Q2 FY 2022, compared with 40% Q1 FY 2022.
  • There was an improvement in the Rubix PF Compliance Score of 41% of the firms in Q2 FY 2022 versus 31% improvement in Q1 FY 2022.
• The Quarterly Monitoring Report pertaining to external Credit Ratings has been prepared based on data pertaining to 1,203 companies:
  • The external credit ratings of only 3% of the companies deteriorated in Q2 FY 2022 compared with 8% in Q1 FY 2022.
  • The credit ratings of 6% of the companies improved in Q2 FY 2022, up from 4% in the prior quarter.
• Extent of Risk Deterioration in Monitored Business Entities: Rubix then studied the extent of risk deterioration in the firms being monitored. It conducted an analysis to check how many of the 3 Risk Variables (#GSTCompliance, PF Compliance and #CreditRatings) had deteriorated for each of the companies. The more the Risk Variables in which there is a deterioration, the higher is the Risk associated with the business entity.
  • 14% of the total firms saw a deterioration in any one of the three Risk Variables in Q2 FY 2022 compared with 39% in the prior quarter.
  • Only 1% of the total firms saw a deterioration in two Risk Variables in Q2 FY 2022 compared with 4% in the prior quarter.
  • Not a single firm witnessed a deterioration in all three Risk Variables in Q2 FY 2022 compared with 14 firms in the prior quarter.

Source: Rubix Data Science