Survey: Nearly half MSMEs witness 20% to 50% impact on earnings due to COVID-19
Parul June 19, 2020
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According to a survey, nearly 50 per cent of micro, small and medium enterprises (MSMEs) have witnessed a 20-50 per cent impact on their earnings due to the disruptions caused by the COVID-19 pandemic.
The findings are based on responses from 14,444 MSMEs. The survey, conducted in the second half of May 2020, focussed on the financial impact of the pandemic on MSMEs and their outlook towards the earnings.
The survey highlighted, “Almost half of the micro and small firms stated that the impact of COVID-19 on earnings was between 20-50 per cent,”. While, both essentials and non-essential manufacturers and suppliers stated a similar impact on earnings, which is less than 50 per cent, it said.
However, close to half the respondents in the non-essential sector were negative in outlook, compared to the 25 per cent for those in the essential businesses. The survey also highlighted that more than two-thirds of the businesses were in the non-essentials business, and were from the southern and western part of the country.
Northern and eastern part of the country reported greater negative outlook among the geographical regions, it said. The survey showed that the respondents seem to be far more positive about their own financial health, with 76 per cent rating themselves average or above average.
Nearly 53 per cent of the respondents had availed of the government’s moratorium either from Magma or from other lenders. Around 51 per cent stated that they did not need to borrow.
As per the survey, health care, telecom, oil & gas, pharmaceuticals and fast-moving consumer goods (FMCG) displayed the highest positive outlook, while tourism and hospitality, gems and jewellery, power and utilities, and textiles and electronics displayed the highest negative sentiments, the findings showed.
Meanwhile, the tourism and hospitality sector appears to be the worst affected in terms of impact on earnings, while the pharma sector is the least affected.