Even in a festive quarter, India Inc has struggled to grow the top line, with most companies unable to push through volumes. Most companies have been unable to meet even the tempered expectations, though some like Bharti Airtel did well after many quarters. However, the pain can be seen in that revenues in the three months to December, remained flat year-on-year (y-o-y).
The increase in the profit after tax is mostly the result of the lower tax rate, else for a clutch of 713 companies, the profit before tax barely grew.
A glance at the results of banks and NBFCs makes it clear that business is dull. Leading lenders have reported a contraction in their corporate loan portfolios. Again, disbursements at NBFCs like Magma Financial, Chola Financial and MMFS have contracted in Q3FY20.
Commenting on the demand, the management at Shriram Transport observed customers were postponing purchases and making do with existing fleet. Even where purchases were being made, these were, more often than not, used vehicles rather than new ones.
The Sobha management cited modest demand trends as a reason for slower launch activity in Q3FY20.The HeroMotoCorp management, while referring to some positives such as a good monsoon, also highlighted that a sustained recovery would take time.
Retailers like Shoppers Stop have barely posted an increase in same-store sales and even at Avenue Supermarts, these rose by just 6-7 per cent y-o-y.
Drug firms like SunPharma reported strong growth in their domestic revenues — up 18 per cent y-o-y, but the overall sales growth was pulled down by a poor show in the US where sales fell 3 per cent y-o-y.
Again, although realisations at HeroMotoCorp improved 4 per cent y-o-y, revenues fell 11 per cent y-o-y on the back of falling volumes which dipped 14 per cent y-o-y. At GSK Consumer, sales were up just 3.8 per cent y-o-y.
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