Mumbai: Corporate India may require over Rs50,000 crore of fresh credit to replace existing high-cost debt over the current and next fiscal, according to projections made by securities firm J P Morgan.

Almost all major Indian companies are in need of debt refinancing, if their balance sheets are any indication. An analysis shows that around half of sensex companies would need re-financing in the immediate term, J P Morgan said in a report.

A big fall in the third quarter corporate earnings is likely to lead to a situation where the companies would find their earnings insufficient to meet interest obligations and force them to seek refinancing, ie, replace existing debt with a new debt obligation having easier payment terms.

According to analysts' estimates, the sensex constituents alone would account for nearly 80 per cent of the Rs50,000 crore ($10 billion) required by major Indian firms to re-finance debt over 18 months.

Hindalco Industries tops the list of companies having higher re-finance requirements, with Rs15,400 crore of high-cost loans, Reliance Industries (Rs6,200 crore), Tata Steel (Rs5,500 crore), Bharti Airtel (Rs2,000 crore) and Reliance Communications (Rs1,900 crore), according to data from J P Morgan.

At the systemic level, J P Morgan estimates debt to be re-financed over the next 18 months at 13 per cent of total borrowings, with materials, consumer discretionary and real estate topping the chart.

Refinancing is usually undertaken to reduce interest costs, extend the repayment time, pay off other debts or to raise cash for investment.

Companies from materials, energy, industrials, telecommunication services and real estate will go for debt-refinancing by May-June 2010, the report said.