The operating profit margin for India Inc. is expected to remain steady at 15-18 per cent in the first quarter (April-June period) in the ongoing fiscal year (FY25), a report showed on Monday.
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The operating profit margin for India Inc. is expected to remain steady at 15-18 per cent in the first quarter (April-June period) in the ongoing fiscal year (FY25), a report showed on Monday.
The evolution of the global economic scenario and the onset and intensity of the monsoons in India would remain a key monitorable over the near term, according to ICRA.
“The 5 per cent YoY and 6.3 per cent sequential revenue growth for corporate India in Q4 FY2024 was supported by healthy demand in consumer-oriented sectors like airlines, hotels, automotive and FMCG,” said Kinjal Shah, senior vice president and Co-Group Head–Corporate Ratings, ICRA Limited.
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In addition, the growth in the power and construction sectors was strong.
Meanwhile, the revenue expansion was curtailed to an extent by a decline in realisation levels amid softening input costs (mainly raw materials), largely for sectors like fertilisers and chemicals, which also faced a demand slowdown due to channel inventory destocking, Shah noted.
According to the report, the growth is likely to marginally slow down in Q1 FY2025 (on a quarterly basis), on a relatively high base, amid a perceived temporary pause in the infrastructural activities for a major part of Q1 FY2025 due to the general elections and the dependency of rural demand on the monsoon.
In Q4 FY24, sectors like auto, power, pharmaceuticals and metals & mining reported YoY improvement in operating profit margin (OPM) on the back of gradual price hikes undertaken and softening of input costs.
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