Credit rating agency ICRA has projected the combined capital spending of a sample of 13 major state governments to expand by 13% to Rs 6.5 trillion in FY25. However, this entails a miss, relative to the FY25 Budget Estimate (BE) of Rs 7.2 trillion, following a dull start to the capex in the initial months of this fiscal as well as the anticipated undershooting in states’ revenues.
The rating agency foresees a modest slippage in the combined revenue and fiscal deficits of the 13 states in FY25 to Rs 2.2 trillion and Rs 8.8 trillion, respectively, from Rs 1.9 trillion and Rs 8.5 trillion, respectively, in the BE. Moreover, ICRA expects the combined leverage (debt+ guarantees) level of the sample set to inch up to 30% of GSDP in FY25 from 29.2% of GSDP in FY24, with continuing variation across the states. Although the Government of India (GoI) had enhanced the allocation for the Scheme for Special Assistance to States for Capital Investments to Rs 1.5 trillion in July 2024 from Rs 1.1 trillion in Feb 2024, its utilisation to the full extent in FY2025 appears somewhat unlikely, following its sluggish offtake in the early months.
ICRA estimates the state GST, excise duty and S&R collections to expand by 11-13% in FY25. However, sales tax collections are projected to grow by a modest 5.5% in FY25, after a modest performance in FY24. Additionally, ICRA expects the tax devolution in FY25 to be in line with the amount indicated by the GoI in its Union Budget published in July 2024. After the double tranche of tax devolution extended recently, the amount of funds remaining to be released relative to the FY25 BE for tax devolution entails a 13% YoY contraction in the balance part of this fiscal, which the states should take into consideration while planning their borrowings for the rest of the year.
MoneyWorks4Me rating and ranking of funds for SIP is available to subscribers only. Moneyworks4Me is not a rating and ranking agency, however it is required that users have a way of selecting funds and building a Portfolio. The method used by it are described below to enable users to understand the logic behind the rating and ranking Subscriber will find more details on this in the various content made available from time to time. In case you need more please write to besafe@moneyworks4Me.com
MoneyWorks4Me rates and ranks mutual funds based on the following data-driven system:
Funds ranking in screeners: Performance Consistency and Quality are two parameters used for ranking funds for SIP. The ranking as follows GG, GO, GR, OG, OO, OR, RG, RO and RR.
With the same color-coded funds, the one with the higher Average 3-year rolling returns (over 5 to 10 years), the number that appears in the Performance tag, ranks higher.
Here is the summary:
The third tag Upside Potential is not relevant for SIP. It is relevant for lumpsum investments in Mutual Funds.
Make an informed decision for Stocks
Invest using an intelligent system with powerful data-driven tools that help you identify opportunities and make informed buy-hold-sell decisions
Buy quality Stocks when they are available at reasonable prices and supported by an upward price trend and Sell when they are Overvalued using the Decizen Rating System. Covers 3500+ stocks
Claim your FREE 15-day access to the most practical investing handbook.
Hurry, limited to the first 10 users today!
FREE Become a savvy and confident
stock investor.
Hurry, limited to the first 10 users today!
Download APP
