Real estate companies are likely to see their revenues fall by about 5 per cent in the July-September period due to increase in cost of inputs like cement. During the same period, airline companies are likely to see EBITDA margins decline sharply to 10 per cent from 22 per cent last year due to higher aviation turbine fuel costs, said a report by CRISIL Research.
According to the report, companies are likely to post a year-on-year (y-o-y) revenue growth of around 15 per cent, as compared to 19 per cent in the preceding quarter and 22 per cent in the corresponding quarter last year. During the July-September period, EBITDA margins are likely to fall to 18.6 per cent from 19.6 per cent last year.
The report is based on an analysis of the aggregate financial performance of select companies across 21 industries (excluding banks and oil csompanies).
Some of the reasons for the moderation in revenue growth and lower EBITDA margins in the second quarter of the current fiscal are decline in consumer confidence, high inflation, rising interest rates and slowdown in investment growth.
Although companies have hiked prices, slower volume growth, along with high input costs and rising wages, would put pressure on margins, the report said.
Further, with increase in interest rates, net margins are expected to fall even more sharply, the report said.
For the construction sector, revenue growth is likely to see a y-o-y slow down to around 11 per cent, while EBITDA margins are projected to decline by 100 basis points to 9.6 per cent due to steep increase in prices of key inputs, mainly cement and steel.
IT services providers are expected to report buoyant revenue growth of around 17 per cent on the back of strong pipeline. However, EBITDA margins are likely to decline by around 200 bps due to rising salary costs, the report said.
The telecom sector is likely to see rise in revenues at a modest rate of 4-5 per cent quarter-on-quarter, as operators have hiked tariffs in key circles. However, EBITDA margins are likely to decline by 200 bps on a y-o-y basis, but on a sequential basis, they would remain stable.