The overall performance of companies was poor in the last financial year. Bottomlines of companies belonging to the automobiles, construction, pharmaceuticals and telecommunications sectors declined in the year ended March 2009. The aggregate net profit of 1217 companies, for which yearly results are available, dipped 1.1% to Rs 1.21 lakh crore. The aggregate sales rose 21.3% to Rs 11.18 lakh crore while other income went up 6.3% to Rs 69,309 crore.
Companies belonging to the IT, fertilizers, electric equipment, paper and personal care segments incurred an increase in profits. Bottomlines of banks also increased. But aluminium, chemicals, electronics, engineering, entertainment, hotels, steel, textiles, trading and tyres companies were among poor performers.
IT companies, among the first to announce results, recorded decent growth rates on the back of depreciation in rupee, which enhanced their export earnings. Infosys Technologies, TCS, Tech Mahindra and Polaris Software led the sector. The aggregate net profit of IT companies increased 16% to Rs 16,067 crore during 2008-09.
An Analyst at a broking firm said, “The year was good for the frontline IT companies. However, mid-cap ones are expected to deliver a mixed bag of results. The demand has been slowly picking up in the US while Europe continues to open up, providing exciting opportunities for the Indian IT industries despite recession.”
The country’s largest private sector IT company, Infosys Technologies, has clocked a healthy 30.2% growth in its net profit. Sales of the company also increased 29.5% to Rs 20,264 crore.
Others which boosted the overall sales growth rate of companies were Hindustan Unilever, Coromandel Fertilizers, JK Tyre Industries, Reliance Infrastructure, PTC India and Jaiprakash Associates.
The net profit of Coromandel Fertilizers increased by 136.6% to Rs 496 crore while sales rose by 149.5% during the year. On the other hand, the net profit of PTC India increased by 86.4% to Rs 91 crore. The company’s sales increased 67.2% to Rs 6,533 crore.
In the banking sector, Oriental Bank’s performance has turned out to be impressive. While the main income jumped by 29.5% to Rs 8,856 crore, the net profit rose by 156.3% to Rs 905 crore.
HDFC Bank also posted a sharp jump of 61.5% in its main income at Rs 16,332 crore and a 41.2% rise in net profit at Rs 2,245 crore. The aggregate net profit of banks increased 26.5% to Rs 37,987 crore during 2008-09.
At the profit after tax (PAT) level, 107 companies have reported increase of more than 100% with Ester Industries recording a growth of 233.6%. Nearly 58% of the sampled companies recorded lower net profits during 2008-09. Only three industries–electric equipment, paper and sugar–showed an upward trend in the net profit to sales ratio during the previous fiscal.
