Could disrupt supply chains in mid-term: Ind-Ra

Could disrupt supply chains in mid-term: Ind-Ra
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India Ratings and Research (Ind-Ra) on Tuesday said coronavirus outbreak could disrupt supply chains and impact credits in the medium term.

New Delhi: India Ratings and Research (Ind-Ra) on Tuesday said coronavirus outbreak could disrupt supply chains and impact credits in the medium term.

The ratings agency, however, said supply chains of Indian companies are unlikely to be materially affected in the near term if the outbreak remains contained in Hubei province.

On the other hand, if it spreads over the next three to four months, sectors like pharmaceuticals, textiles and automobiles could face supply disruptions for critical raw materials, Ind-Ra said in a statement.

"In case the virus is transmitted over the next three to four months, the extent of supply chain disruptions globally could be higher than that during the 2003 SARS outbreak," it said.

The quantum of impact on sectors would be contingent on the nature of business activity and the nature of linkages the rest of the world has with mainland China, Ind-Ra added.

Specific to Indian companies, the agency said it does "not expect the novel coronavirus (2019-nCoV) outbreak to materially affect Indian corporates' supply chains in the near term, provided it remains contained in the Hubei province".

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