NEW DELHI: Two bellwether firms for their respective segments — Tata Consultancy Services and Hindustan Unilever — kicked off the results season last week on a positive note.
TCS saw revenue growth return to double digits after a few quarters in the doldrums, while HUL’s 11.1 per cent revenue growth signalled an upswing in FMCG demand.
Both firms also posted robust year-on-year net profit growth: TCS (22.6 per cent) and HUL (19.5 per cent). Other major firms like Infosys, Mindtree, Reliance Industries and IndusInd Bank are set to declare their results this week.
Brokerages and analysts predict that India Inc is likely to record largely positive results. According to Crisil, corporate revenue growth, excluding that of banking, financial services, insurance, and oil companies, is expected to come in at around 12 per cent.
“This would mark the fourth consecutive quarter of double-digit growth,” the forecast said, adding that “broad-based recovery across consumption-linked sectors, coupled with higher commodity prices, is helping India Inc grow at a faster clip”.
ICICI Securities pointed out that while a high base last year due to GST and a delayed festive season this year might affect toplines in consumption oriented sectors, Sensex listed firms are expected to see revenue growth of around 14 per cent.
“The growth is largely supported by companies in oil & gas (higher crude prices resulting in higher realisation), FMCG (led by organic volume growth) and IT space (attributable to higher share of digital segment & new deal wins),” it said. However, companies in the automobile and banking segments are expected to be relatively subdued. Crisil, meanwhile, expects commodity -linked sectors, such as steel products, natural gas and petrochemicals, to grow sharply due to increasing realisations.
Export-linked sectors like IT, Pharma and Textiles are also expected to receive a boost from the depreciation of the rupee against the US dollar. “Textiles, specifically cotton yarn, and the two-wheeler segment are expected to be buoyed by better demand from key export markets,” Crisil said. Sugar and telecom, however, afflicted by low realisations and pricing pressure are expected to perform poorly.