Page 12 - MSME BULLETIN 2022 .indd

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M MSME & START-UP BULLETIN, VOLUME 1, ISSUE 1, AUGUST 2022
MSME & START-UP BULLETIN, VOLUME 1, ISSUE 1, AUGUST 2022
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EDITORIAL
ore than a quarter of India’s Micro, Small and Medium Enterprises (MSMEs)
lost market share of over 3% due to the Covid-19 pandemic, and half of them
Msuff ered a contraction in their earnings before interest, tax, depreciation and
amortisation (EBITDA) margins because of a sharp rise in commodity prices last fi scal,
compared with the pre-pandemic (fi scal 2020) level, CRISIL Research’s SME Report
2022 reveals.
The report refers to an example and states that the pandemic-induced supply chain
disruptions impacted small pesticides manufacturers more. On the other hand, large ones
leveraged their global presence to procure raw materials, so could eat up a huge chunk
of the SME pie. Surging input costs weighed heavy on sectors that operate in low-margin
products and have limited pass-through.
The report predicts that in the milieu, MSMEs should see revenue increase 9-11% this fi scal
to 1.25 times the fi scal 2020 level, though EBITDA margin is likely to remain range-bound
at 5-5.5%. While the industry EBITDA margin is expected to touch the pre-pandemic level
this fi scal, MSMEs in more than half the sectors will buck the trend. The performance is
also underwhelming in the context of overall corporate India, which is expected to log a
10-14% increase in revenue and EBITDA margin of 19-20%.
Facilitating the transformation of an underwhelming performance into an overwhelming
performance is the core attribute of the CMA fraternity. The MSME is calling! The CMAs
are, certainly, equipped to visualise the needs of MSMEs in terms of innovative cost
and return management tools & techniques and to enable the MSMEs to bounce back
with rigour and vigour. Given the context, here goes your MSME Startup Bulletin that is
intended to broaden your sphere of profi ciency from quarter to quarter.
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