Mumbai, March 10 -- The strong corporate balance sheets of companies in the current cycle lay the foundation for the market recovery, says a report by DSP AMC.

The report stated that the companies have often relied on excessive debt to fuel their growth, sometimes pushing their balance sheets to risky levels. In many market cycles, this over-reliance on borrowings has led to financial instability, making businesses vulnerable to downturns. However, the situation seems different in the current cycle.

It said, "In the current cycle, however, balance sheet leverage has remained relatively controlled, with net debt levels not rising significantly unlike previous cycles".

The report also added that after the COVID-19 pandemic, many business...