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 2,744 listed NGNF companies for Q1:2017-18. Data pertaining to Q1:2016-17 and Q4:2016-17 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

• Sales growth (Y-o-Y) of the manufacturing companies remained robust in Q1:2017-18, led by industries like cement and cement products, iron and steel, electrical machinery and apparatus and food products and beverages.

• The information technology (IT) sector witnessed further decline in sales growth.

• Sales of the services sector companies (other than IT) witnessed a turnaround after four successive quarters of contraction mainly due to the wholesale and retail trade and transport and storage services companies.

Expenditure

• At the aggregate level and for the manufacturing sector, raw material expenses growth remained high albeit with some moderation in relation with the previous quarter, while staff costs growth accelerated for the services (other than IT) sector.

Operating profit

• Sharp increase in the cost of raw material led to heavy contraction in operating profits for the manufacturing sector.

• The services (other than IT) sector and the IT sector also recorded lower operating profit as compared with Q1:2016-17.

Interest

• Interest expenses remained muted in Q1:2017-18 at the aggregate level and for the manufacturing sector.

• Within the manufacturing sector, motor vehicles and iron and steel industries experienced higher growth of interest expenses than in the previous quarter.

• There was no sign of improvement in the interest coverage ratio for the services (other than IT) sector.

• The interest coverage ratio for the telecommunication industry weakened further in Q1:2017-18.

Net profit

• Barring the IT sector, net profits contracted heavily despite some support from other income.

Pricing power

• The operating profit margin declined for the manufacturing and services (other than IT) sectors.

• The IT sector recorded an improvement in net profit margin aided by other/non-operating income.

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.

• Listed companies having net worth more than ₹500 crores were mandated by the Ministry of Corporate Affairs to adopt the new accounting standards ‘Ind-AS’ since Q1:2016-17 and rest of the listed companies have also adopted the same from Q1:2017-18.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.

Ajit Prasad
Assistant Adviser

Press Release : 2017-2018/1001