MODI FACTOR YET TO SHOW. BETTER DAYS ELUDE EARLY BIRDS . THE COMBINED NET PROFIT OF 290 COMPANIES, EXCLUDING INFORMATION TECHNOLOGY ( IT) EXPORTERS, HAS RISEN ONLY 2.4 PER CENT ON A YEAR- ON- YEAR BASIS, THE SLOWEST PACE IN NINE QUARTERS KRISHNA KANT Mumbai, 27 July The early- bird results for the first quarter of this financial year do not seem to justify the current rally on Dalal Street. The combined net profit of 290 companies, excluding information technology ( IT) exporters, has risen only 2.4 per cent on a year- on- year basis, the slowest pace in nine quarters. The same set of companies had reported 3.8 per cent annual net profit growth in the previous quarter and 7.5 per cent annual growth in the same quarter last financial year. The net profit of the entire sample of 316 firms that have announced their results so far ( including IT companies) was up nine per cent year- on- year in first quarter, compared with 10.7 per cent growth in the fourth quarter of last financial year and 8.4 per cent growth in the year- ago period. Volume growth has remained on a slow track, with revenues rising 10 per cent ( except IT), compared with 10.5 per cent annual growth in the previous quarter and 3.9 per cent growth during the same quarter last year. The brighter side, however, is that the companies in the domestic manufacturing and services sectors ( excluding IT, financial and oil & gas ones) have reported higher net sales growth of 9.5 per cent in the first quarter, against 5.8 per cent in the previous quarter — the upside, though, has been largely due to a handful of good results like those of Idea Cellular, Asian Paints, TVS Motors and Reliance Power. Analysts expect revenue growth to moderate in the coming quarters, as the trail impact of the pre- election spike in government spending might level off. Exporters like Tata Consultancy Services, Infosys and Bajaj Auto face the heat from a continued strength in the rupee on the back of foreign capital inflows. Net growth for IT companies moderated to 18.3 per cent, from more than 25 per cent in the previous three quarters, while net profit moderated to 31.1 per cent from the previous quarter’s 37 per cent. As in the previous quarter, IT companies were still the biggest growth drivers, accounting for 80 per cent of the incremental net profit and 28 per cent of the incremental net sales in the first quarter. epaper.business-standard/bsepaper/svww_zoomart.php?Artname=20140728aA001101001&ileft=177&itop=208&zoomRatio=130&AN=20140728aA001101001
Posted on: Mon, 28 Jul 2014 14:16:17 +0000
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