New Delhi, May 27 -- The oil price spike, petrol and diesel hike and the recent WPI print have brought the spotlight back on inflation. And when inflation rises, it not only erodes the purchasing power of households but also threatens the margins for India Inc.

At the end of the December quarter, analysts had warned that the easy phase of margin-led profit growth might be over, with the post-COVID benefits of lower input costs and pricing power now receding. Given the latest developments in West Asia and its subsequent impact on oil prices, a major input cost for many industries, the impact on margins is likely to be steeper.

Since the onset of the Middle East war between the US and Iran, oil prices have spiked by almost 55%. Currently,...