Emerging economies will struggle over the next few quarters due to the war in Ukraine, said Atsi Sheth, head of global strategy and research at Moody's Investors Service.
She added that while the overall picture looks bleak, commodity exporters will record better results than other countries or companies.
Moody's predicts that nearly 30% of rated non-financial companies in emerging markets will face "higher credit risks" in a worst-case scenario in which a war in Ukraine triggers a global recession and a liquidity squeeze, including the suspension of energy trade between Europe and Russia.
Companies that cater to consumers are likely to be hurt a little more because their wallets will be constrained by inflation, Sheth said.
Moody's research found that Asian firms are more at risk due to supply chain disruptions and limited access to finance, while Latin American corporations are less vulnerable.
In a less severe scenario, with commodity shocks, higher inflation and interest rates dampening global growth in 2023, about 8% of emerging market firms face increased credit risk.
Automotive manufacturing is one sector that may continue to suffer from supply chain disruptions.
At the sovereign level, the credit agency is closely following this year's emerging market elections, as the need for change amid economic and financial hardship could lead to political change.
In Colombia, on May 29, presidential elections will be held in the first round, and in Brazil - in October.
Credit risk increases when a democratic government changes to an authoritarian one, and vice versa. Moody's estimated that in 25% of such cases there are concomitant defaults on the country's government bonds.