India Inc improved its financial performance further in the June 2018 quarter as corporates have reported strong set of numbers on an overall basis. Year-on-year growth in net sales, operating profit and adjusted net profit of 90 companies at 18.7 per cent, 29 per cent and 25.4 per cent have been the highest in eight quarters, according to data provided by Capitaline . Companies with sales of over ₹100 crore in the June 2018 quarter have been considered for the analysis.
Vinod Nair, Head of Research at Geojit Financial Services, said Q1 results have started coming positively in line with expectations and this helped the market to stay afloat despite trade tensions, rising bond yields and weak rupee last week. Jimeet Modi, CEO & Founder of Samco Securities & StockNote, expressed a similar opinion on Q1 results.
The good performance has been led by a favourable base effect and by sectors such as financial services (including banks) and metals. Excluding financial services and metals, growth in net sales, operating profit and adjusted net profit of 67 companies stood at 16.3 per cent, 22 per cent and 22.5 per cent — again best in eight quarters. In the same quarter last year, sales (ex-financials and metals) grew in the lower single digit of around 2 per cent y-o-y, while operating profit and net profit declined due to lack of clarity and disruptions caused by implementation of Goods and Services Tax combined with firm input costs.
Not only did large companies such as Tata Consultancy Services, HDFC Bank and HUL report robust financial performance, but relatively smaller entities such as Ashok Leyland, ABB, Havells India, JK Tyre and Industries, Mindtree and ICICI Lombard also recorded substantial jump in numbers (unlike in the previous quarter).