India Inc’s revenue grows 4-6 pc in Q1; pharma, retail lead

Mumbai, July 28 The revenue of corporate Indian companies grew at a modest 4-6 per cent year-on-year (YoY) in the April-June quarter (Q1), according to a report on Monday.

Five sectors -- pharmaceuticals, communication services, organised retail, aluminium, and airlines -- pushed the revenue of corporate India, Crisil Ratings said in its latest report.

Pharmaceutical revenue growth is 9-11 per cent YoY, outpacing corporate India's growth over the past 10 quarters, due to robust export demand and a steady domestic market.

Even as earnings before interest, tax, depreciation and amortisation (EBITDA) rose 4 per cent YoY, the EBITDA margin fell 0.10 per cent to 0.30 per cent, weighed down by IT services, automobile, fast-moving consumer goods (FMCG) and pharmaceuticals.

“The early onset of monsoon and lingering geopolitical uncertainties impacted some sectors in the April-June period," said Pushan Sharma, Director, Crisil Intelligence.

"Geopolitical uncertainties impacted the IT services sector, leading to flat YoY revenue growth due to project delays caused by tariff concerns,” he added.

Looking forward, despite concerns of excessive inventory, high retail sales, increasing exports and product mix adjustments are expected to boost auto sector revenue by 4 per cent.

Engineering, procurement and construction (EPC) companies are expected to see a 6 per cent growth due to a low base effect from general elections in Q1 FY 2025. Revenue from telecom services is expected to grow 12 per cent due to more expensive subscription plans, the report said.

Airline income is projected to grow 15 per cent due to increased volume from reduced aircraft groundings and new aircraft additions.

A pick-up in rural demand supported the FMCG sector's volume growth and drove revenue growth of 17 per cent on-year in the tractor sector. Moderating food inflation, a favourable monsoon and a good harvest season for rabi crops contributed to the rebound in rural demand. Telecom services margin likely surged 290-320 bps on-year due to lower operating expenses, the report added.

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