India Inc's Revenues See Modest Growth Amid Sectoral Discrepancies

India Inc's revenue witnessed moderate growth of 4-6% in the April-June quarter of the current fiscal year, according to a report by Crisil, which analyzed over 600 companies. This marks a slowdown from the 7% growth observed in the preceding two quarters. The slowdown is attributed to underperformance in the power, coal, IT services, and steel sectors, which together contribute a third of the total revenue.

Earnings before interest, tax, depreciation, and amortization (EBITDA) rose by 4% year-on-year; however, the margin is estimated to have declined by 10-30 basis points. Declines in the IT services, automobile, FMCG, and pharmaceutical sectors weighed on margins, according to remarks from Pushan Sharma, Director of Crisil Intelligence. He also highlighted that early monsoons and ongoing geopolitical tensions have adversely affected some industries within this period.

The power sector suffered an 8% revenue drop due to diminishing electricity demand from rainy conditions, which also reduced coal demand. Meanwhile, IT services faced flat revenue growth because of project delays amidst tariff issues. In contrast, sectors such as pharmaceuticals, telecom services, organized retail, and airlines reported significant revenue expansions, driven by increased export demand, costlier subscriptions, and market segment growth. Despite these dynamics, Crisil noted mixed trends in the EBITDA margins across the leading sectors.

(With inputs from agencies.)