#Post 12 : How Much Did we Suffered from COVID-19? (Part 2)

Retail

 The Indian retail industry has seen a massive setback because of the coronavirus pandemic. Ever since the pandemic spread various malls and stores have been shut for over a month indicating worse times ahead. Credit rating agency CARE ratings have given the retail sector in India a 'Negative' outlook. The impact on demand, which is expected to remain muted at least for the next three or four quarters, will be more in the case of players with a presence in non-essential items and luxury segments. However, groceries will prevail asking. According to CARE agency “The retailers with a presence in essential commodities continue to have some cash flows to support their fixed costs.”

Automobiles

The automobile sector in India has been forced to stop key manufacturing activity and has led to a sharp drop in production and sales. With most of the plants shut, big automobile manufacturing companies have announced pay cuts and are waiting for a decision on resumption of dealerships. In March 2020, all OEM’s witnessed a sharp drop in wholesales due to COVID-19 related lockdown. COVID-19 led to supply chain disruptions and production halt in the latter half of March 2020. A recent example is that the sales of Toyota & Hyundai both declined by almost 45% & 41%. TVS has stopped production earlier on March 23^rd due to reduced sales and nationwide lockdown. Though not in imminent danger, things can begin to change for the worse if the Coronavirus continues to plague the industry. As the automakers have enough stock to last a month, the situation grows sinister. Though not in imminent danger, things can begin to change for the worse if the Coronavirus continues to plague the industry. Until it does, the Indian market can expect a worrisome dwindling of sales in the near future.

Real estate

Finally, the real estate sector outlook has also suffered immensely due to the lockdown, which was announced to prevent the spread of the deadly Covid-19 virus. In the long run, such a reduction in commercial and residential property could reset the future of real estate in India. Besides, while construction activities have resumed in some areas, there are many hotspots areas in urban areas where key construction projects have been put on hold for several weeks due to the lockdown. This has led to unemployment among millions of migrant laborers in India, who are engaged primarily in construction activities. Hardly anyone of these laborers, who live on daily wage, have additional savings to see off the lockdown period. The government has urged employers to not cut wages or lay off such laborers. However, companies are left with no choice but to let their workers go due to cash flow issues.

The Road ahead

To contain the virus and prevent its spread, individuals across the world have been advised to practice social distancing and self-isolation. As people are forced to stay at home, home entertainment services such as Netflix and Spotify are increasing in popularity. Similarly, social networking apps such as Facebook, Instagram and Skype are predicted by analysts to rise in popularity as they allow people to keep in touch across the globe. Businesses have also encouraged their employees to work remotely from home, causing shares in video-conferencing businesses such as Slack and Zoom to skyrocket. Pharmaceutical companies will benefit from increasing investment for the development of a vaccination for Covid-19. Companies such as Johnson & Johnson are ‘repurposing’ products developed for HIV, Ebola and other epidemics while Roche Holding AG is developing a testing kit for the virus. Grocery stores across the world have been facing shortages as individuals flock to panic buy and stock piles on items such as perishable consumer goods, hand sanitizer, non-perishable foods such as tinned goods and pasta and even frozen food. Company which specializes in disinfectants and cleaning products are also witnessing a rise in consumer demand and an increase in stock market value. However, certain commercial businesses engaged in consumer goods have been enjoying greater market share at the moment. 

                                                                                                    by Sneha Paranjpe