Corporate debt-to-equity is at an all-time high and debt service ratio is at a new low. The BSE 500 index companies have about four times their operating income to pay interest expenses compared to around 10 times in the boom years, shows a Morgan Stanley research.
Interest to sales is approaching is at an all-time high, hurting net margins and impeding debt serviceability. Similarly, excess return on capital (ROCE minus the prime lending rate) is at an all-time low and in negative territory.
