Rise In Expenditure Weighs on Operating Profit Growth Of Listed Firms: RBI

The Reserve Bank released data on the performance of the private corporate sector during the fourth quarter of 2021-22 drawn from abridged quarterly financial results of 2,758 listed non-government non-financial (NGNF) companies. According to the report, operating profit growth of listed private companies decelerated across broad sectors in the January-March quarter of 2021-22, on the back of rise in expenditure. RBI data further said sales of 2,758 listed private non-financial companies recorded a healthy growth of 22.3 per cent (year-on-year) in fourth quarter of 2021-22, compared to 22.8 per cent in the comparable quarter of previous year. Information Technology (IT) companies continued their move on growth trajectory with 20.7 per cent growth in sales during fourth quarter of 2021-22. Sales of non-IT services companies expanded by 20.9 per cent (y-o-y) in January-March period 2021-22, led by steady growth in transport, trade, telecom, hotel and restaurant sectors. Despite rising expenditures, manufacturing companies maintained their operating and net profit margins in Q4:2021-22 as compared to Q3. Net profit margin remained stable for IT companies while for non-IT services companies it remained in negative terrain due to losses recorded by telecom and transport companies.

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