The Reserve Bank compiles and releases data based on abridged financial results of listed non-government non-financial (NGNF) companies. This release relates to abridged financial results of 2,784 listed NGNF companies for Q3:2016-17. Data pertaining to Q3:2015-16 and Q2:2016-17 are also presented in the tables to enable comparison. The data can be accessed at https://dbie.rbi.org.in/DBIE/dbie.rbi?site=statistics#!2_42.

Highlights

Sales

• Aggregate sales growth improved in Q3:2016-17, primarily in the manufacturing sector and led by industries like iron and steel, petroleum products and the information technology (IT) sector.

• Sales of services sector constituents (other than IT) however continued to contract for three successive quarters.

Expenditure

• At the aggregate level and in the manufacturing sector, raw material expenses increased sharply relative to the previous quarter, while staff costs decelerated across sectors.

• The cost of raw materials to sales ratio increased at the aggregate level and for the manufacturing sector, whereas the staff cost to sales ratio declined across sectors.

Operating profit

• Despite increased expenditure on raw materials, operating profit growth improved at the aggregate level and for the manufacturing sector, due to the improvement in sales growth.

• Services (other than IT) sector recorded a significant contraction in operating profits, with the contraction in sales being sharper than that of expenditure.

Interest

• Interest expenses grew sharply in Q3:2016-17 as compared with the previous quarter at the aggregate level as well as for the manufacturing and the services (other than IT) sectors.

• Within the manufacturing sector, textiles, motor vehicles and the iron and steel industries experienced higher growth of interest expenses.

• In the services (other than IT) sector, higher interest expenses were attributable to the telecommunication industry.

• The Interest coverage ratio declined significantly in Q3:2016-17 relative to the previous quarter at the aggregate level and also for the manufacturing and the services (other than IT) sectors.

• The interest coverage ratio for the telecommunication industry fell below one in Q3:2016-17.

Net profit

• Net profit growth improved significantly for the manufacturing sector, which also pulled up net profit growth at the aggregate level, despite a contraction in the services (other than IT) sector.

Pricing power

• Operating profit margin declined slightly for the manufacturing and the services (other than IT) sectors, and also for the aggregate level, while it improved for the IT sector.

• Net profit margin declined at the aggregate level as well as across sectors.

Note:

• Coverage of companies in different quarters varies, depending on the date of declaration of results; however, this is not expected to significantly alter the aggregate position.

• Major listed companies, have moved into the Indian Accounting Standards from Indian GAAP, as mandated by the Ministry of Corporate Affairs (MCA), since Q1:2016-17. The impact of transition, appears muted at the aggregate level in terms of the growth rates, although the same may not hold for the ratios.

• ‘Explanatory Notes’ containing the brief methodology followed for compilation of data and the glossary (including revised definitions and calculations that differ from previous releases) are given at the end.

Jose J. Kattoor
Chief General Manager

Press Release: 2016-2017/2544