India's Corporate Sector Rebounds with 7.2% Sales Growth in 2024-25

According to the Reserve Bank of India, sales growth for listed private non-financial companies in India improved to 7.2% in the fiscal year 2024-25, a significant rise from the previous year's figure of 4.7%. This data comes from a comprehensive analysis of 3,902 listed non-government non-financial companies.

In the manufacturing sector, sales increased by 6.0% compared to a 3.5% rise the prior year, buoyed by robust performances in the automobile, electrical machinery, food and beverages, and pharmaceuticals industries. However, the petroleum, iron, and steel sectors faced a downturn, experiencing contractions in their sales.

The information technology sector defied global challenges, recording a growth rate of 7.1%, up from 5.5% last year, while non-IT services companies enjoyed double-digit growth, driven by strong performances in telecommunications, transport and storage, and wholesale and retail trade sectors.

Rising input costs affected the manufacturing sector, with raw material expenses increasing by 6.6% and the raw material-to-sales ratio climbing to 55.7% from 54.2% a year ago. Staff costs rose by 10.0% in manufacturing, 4.4% in IT, and 12.0% in non-IT services, though the staff-to-sales ratio remained stable for manufacturing and moderated for services.

Despite higher input costs, operating profit growth for manufacturing companies slowed to 6.0% from 12.4% the previous year, while non-IT services saw a decrease to 15.9% growth. IT companies saw a slight increase to 6.1%. The operating profit margin fell by 20, 80, and 30 basis points to 14.2%, 21.9%, and 22.1% for manufacturing, IT, and non-IT services, respectively.

(With inputs from agencies.)