India’s domestic shipping sector is bracing for an 8-10% revenue decline in FY26, according to a CRISIL Ratings report, primarily due to falling charter rates for crude oil, petroleum products, and dry bulk carriers. Following a peak growth of 35% in FY23, driven by surging charter rates amid the Russia-Ukraine conflict and post-pandemic demand, the industry has since seen revenue and margins slide. In FY25, operating margins are expected to fall further to 32-34%, down from over 40% last year, though still above the cyclical norm of 25-30%. Notably, modest capex plans and stable credit profiles are expected to cushion companies from the full impact of this decline. The debt-to-EBITDA ratio, a key financial indicator, is expected to rise moderately to 2.0-2.2 times next fiscal from 1.4 times in FY24. Even so, robust liquidity and asset monetization capabilities should insulate companies from cyclical pressures. CRISIL emphasized that geopolitical developments could significantly impact charter rates and industry dynamics, warranting close monitoring. For now, the sector appears poised to weather the downturn with resilient fundamentals.