T&D equipment suppliers likely to be resilient to business disruptions: Ind-Ra
01 Jun 2020
According to India Ratings and Research (Ind-Ra), while the slowdown in construction and infrastructure activities due to more than 60 days of nationwide lockdown will impact the revenue growth of transmission tower suppliers in the near term, those engaged in the supply of transmission and distribution (T&D) equipment are expected to be more resilient than the traditional steel industry. Orders for customised transmission towers are obtained through tenders from government organisations with a 6-12-month supply period.
The orders are backed by secured funding programmes. Even for export orders, the counterparty is government-backed entities or projects. As per Ind-Ra, the government's thrust on infrastructure development to support the economy could result in a faster recovery for transmission tower companies than traditional steel companies.
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