Fourth quarter corporate earning numbers show a mix trend

A sample of 88 companies that declared results for the March quarter, reported 9.3% year-on-year revenue growth. But net profit grew by just 5.6% due to a higher base in the form of much better growth of 22.4% in year earlier. Operating margin rose by 50 basis points to 22.3% from a year ago. A basis point is one-hundredth of a percentage point.
The sample excluded banking, finance and, oil and gas companies.Considering the performance of the oil and gas sector, where Reliance Industries delivered robust growth, overall revenue growth shot up to 20.5% while net profit grew 6.6%.
It is too early to predict a broad trend for corporate India given the small sample size. In addition, results of large companies from various sectors including capital goods, cement, construction, power, and real estate that have shown stress in the past are awaited in the next few weeks.

The results so far reveal a mixed trend. Companies such as Ultra-Tech Cement and Maruti Suzuki India performed in line with expectations whereas IT companies including TCS and Infosys reported muted numbers.
India Inc is likely to report a sustained momentum in March quarter performance. According to the ET Intelligence Group’s estimates, the sample of Nifty 50 companies are expected to report 8.9% revenue growth and 12.4% net profit growth for the quarter, year on year.