Kolkata, Oct 27 (PTI) Crisil Ratings said post the rationalisation of GST on commercial vehicles, acquisition of new fleet by the operators would decline substantially.

It said in a statement on Monday that GST on commercial vehicles has been reduced to 18 per cent from 28 per cent.

"This will bring down the acquisition cost of fleet operators," it said.

Domestic commercial fleet operators are expected to clock a revenue growth of eight per cent to ten per cent this financial year, according to the statement. Strong domestic demand and import-related fleet requirements will drive growth.

Higher revenues and stable margins will result in improved cash flows, which will partially fund the incremental working capital requirement, the statement said. Dependence on external short-term debt will be limited, and operators will undertake additions to their fleets funded by long-term loans.

Increased fleet utilisation will ensure operating margins to remain stable between eight per cent to 8.5 per cent, according to the statement. PTI dc RG

Commercial vehicle GST cut lowers fleet acquisition costs, shifting financing toward long-term loans and improving cash flows. Reduction of GST on commercial vehicles to 18% from 28% will lower acquisition costs for fleet operators, enabling fleet additions financed more by long-term loans and less by short-term external debt; projected 8-10% revenue growth and stable operating margins (8-8.5%) will improve cash flows and partly fund working capital needs.