Indian companies deliver on Street hopes in first qtr
NEW DELHI : Corporate earnings in the June quarter met and, in many cases, exceeded market expectations, showed an analysis of 456 companies that have declared results so far. The aggregate net profit and revenue of these companies grew 32% and 7.88% from a year earlier, with profit growing at the fastest pace in eight quarters. Earnings are panning out mostly on expected lines with excellent performance from banks and weak guidance from the information technology (IT) sector, said V.K.
Vijayakumar, chief investment strategist at Geojit Financial Services. “Banks have reported very good results, with the best-in-class performance by ICICI Bank," said Vijayakumar. The trend of declining non-performing assets (NPAs), decreasing provisions, and rising profit continues, he said.
According to analysts at Jefferies India Pvt. Ltd, profits and loans at leading lenders grew over 30% and 15%, respectively, during the quarter, with stable asset quality. However, net interest margins (NIMs) have started to flatten, they noted.
Even after excluding banks and financials, net profits for the remaining 365 companies grew a robust 25%, supported by declining raw material costs. Raw material costs fell 9.43% year-on-year (y-o-y), supporting operating profit growth. The profits before interest, depreciation, and tax (PBIDT) rose 19% y-o-y.
Pramod Amthe, the head of institutional equity research at InCred Capital, said the market had estimated 25% net profit growth on last year’s low base. Just a tenth of 4,500 listed companies have declared earnings so far, and the numbers have been above expectations. The impact of easing commodity cost pressures has been visible for one or two quarters now, but gains are still building as supply chains
. Read more on livemint.com
