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Credit rating agency Moody's Investors Service said the earnings of emerging market (EM) companies in Asia-Pacific region will be better than that of companies in development markets (DM).

Amongst the five countries - China, India, Malaysia, Indonesia and Thailand - where Moody's has the largest coverage of companies, India's improvement is the strongest, Moody's said.

"On aggregate, rated EM companies' EBITDA will grow 28 per cent this year compared with 2019. DM companies' earnings will grow by a smaller degree of 14 per cent in the same period," Moody's said.

However, EM companies have taken on more debt relative to earnings growth, resulting in weaker debt to EBITDA.

"We project EM companies' average leverage will rise to 5.1x inA2022 from 4.3x in 2019. DM companies' leverage will be largely stable at around 4.5x," Moody's said in a report.

According to Moody's, a large proportion of rated commodity producers in China, Indonesia, India, Malaysia and Thailand will drive EM earnings growth, as they benefit from high prices this year.

Companies in Indonesia will report the highest earnings growth of 56 per cent, followed by 51 per cent in India and 36 per cent in Thailand.

Moody's said India's improvement is the strongest among the five countries, as reflected by earnings growth of 51 per cent and leverage improvement of 1.6x.

"Leverage will improve for 17 of the 19 rated companies in India. Refining and marketing companies' limited ability to increase fuel prices despite higher feedstock costs will hit their earnings and leverage," Moody's said.