Mumbai: Ahead of the announcements of the fourth quarter results, ratings agency Crisil today said India Inc’s revenue growth may slip to a seven-quarter low at 2.5 per cent due to overall sluggishness in several sectors. “The year started on a promising note, with revenue growing by 12.8 per cent in Q1FY15. However, growth has decelerated in subsequent quarters with Q4 likely to show the lowest growth,” Prasad Koparkar, a senior director at Crisil’s research wing, said.
Companies had reported a tepid 5.4 per cent growth in the revenue during the preceding December quarter, it said. Koparkar pointed out that cement companies, where the volume growth is at a sluggish 2 per cent, and capital goods manufacturers will face trouble in revenue growth, adding that in case of the latter, the revenues may fall by as much as 13 per cent over last year.
Even though the domestic consumption and export
sectors are likely to do better, there will be certain companies within it like those focused on rural consumption which are likely to bear an impact of the unseasonal rains. In the fast moving consumer goods segment, revenue growth is expected to slip to 8-9 per cent for the March quarter as against the 14 per cent reported in the first two quarters of the fiscal, it said, adding that telecom companies will not be impacted much and maintain the 11 per cent revenue growth.
The agency, however, said that it expects a marginal uptick in the pre-tax profit margins to be reported by the companies. On the profitability front, companies in cement, telecom and petrochemicals sectors will outperform, it said, adding that they will witness a margin expansion of 2.30 per cent, 1.80 per cent and 1.25 per cent, respectively.
However, steel, capital goods, fertilisers, IT services and pharmaceuticals sectors will see a decline in the pre-tax profit margins, it said. “Steel players will be hit by lower realisations, whereas weak utilisation levels will impact the capital goods sector. Fertiliser players will bear the brunt of higher raw material cost in complex fertilisers and shutdown of urea plants,” its director Ajay Srinivasan said.
All the listed companies, which have to report their performance every quarter, will start coming out with their numbers for the January-March period starting from next week. According to some analysts, the corporate performance will be tracked more closely from now on, especially after the confusion created by the revision in the GDP growth modeling.