he outlook for the Indian auto component sector derives from Fitch Ratings’ outlook on domestic original equipment manufacturers (OEMs), as well as the agency’s outlook on the global automotive sector.
With substantial demand and margin pressures being faced by both Indian and international OEMs, the domestic auto component sector is also likely to face substantial operating pressures in calendar year 2009 (CY09). Component players will likely face demand pressures in line with their customers, although the impact on cash flows could likely be more severe in view of OEMs lengthening their payment periods.
Export-focused players are likely to face additional pressure from receivable risks on the back of the deteriorating credit profiles of the large international auto majors...
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