Debt in Indian Companies

How much debt have Indian companies taken on over the last few years?

Chart shows the aggregate debt on the balance sheets of listed Indian companies from 2008 to 2017. Note this is from a sample of ~ 1,000 largest companies by market cap.

The Calm Investor | Corporate Debt India

Since 2008, total debt has grown by 3.7X from 7.6 Lakh Crores (USD 116.8 Billion) to 28.3 Lakh Crores (USD 434.9 Billion) in constant currency terms. For context, the lines on the chart show total debt as a percentage of market cap and of country GDP (unadjusted for inflation).

Which brings us to the natural question:

Which are the sectors with the most and the least debt?

The Calm Investor | Sectors with lowest debt | Sectors with highest debt

Considering only sectors with an aggregate current market cap of roughly $3B and above, 7 sectors (Iron & Steel, Roads & Highways, Sugar, Telecom Services, Electric Utilities, Construction & Engineering and Integrated Oil & Gas) have more debt than their market capitalisation currently.

On the other hand, Tobacco Products, Passenger Car makers, Mining, Two/Three Wheeler makers have under 1% Debt / Market Cap.

Lastly, here’s a list of the top 40 Debt / Market Cap companies currently in India (minimum market cap of ₹1,000 Cr)

The Calm Investor | Top 40 Debt Companies India


Other posts in the #IndiaMarketNumbers series:

The most profitable industries by EBITDA link

The fastest Sales-growing sectors link

Market Cap Ranks over the years by Sector link

 

What do you think?