Key Points

The aggregate net sales of a sample of 1,893 companies were recorded at 5.4 per cent in Q4, while net profits rose by 7.6 per cent, according to the Bank of Baroda (BoB) report.

“There are sectors which are witnessing green shoots of recovery. Infrastructure linked sectors continue to witness steady growth notwithstanding a negative base effect. For consumer linked sectors, such as FMCG and consumer durables, strong rural demand and seasonal demand continues to aid a steady recovery,” said economist Aditi Gupta.

Industries in the services sector also continued to post steady growth amidst sustained demand momentum. Importantly, despite a challenging global environment, companies remain positive on future growth prospects.

“Stable commodity prices, low domestic inflation, favourable monsoon trajectory, trade deals, government capex, tax incentives are likely to be key drivers of growth and demand,” Gupta mentioned.

In Q4, expenditure and interest costs remained muted leading to an improvement in debt serviceability of companies.

Some moderation in sales is observed in a few large sectors, such as oil and gas, textiles and iron and steel, which weighed on the aggregate sample.

“However, this appears to be a one-off phenomenon and not a structural issue. Similarly, the BFSI segment witnessed some slowdown after a strong run last year and can be associated with slowdown in growth in credit,” the BoB report said.

In the context of a tumultuous global trading environment as well as considering the high base of last year, the performance seems quite stable.

In fact, operating and net profits rose by 8.2 per cent and 7.6 per cent, respectively, in Q4 FY25, on a high base of 20.7 per cent and 14.3 per cent last year.

“A total of 24 sectors have noted a higher growth rate in net sales than the comparative net sales for the aggregate sample (5.4 per cent). For PAT, 16 sectors have witnessed higher growth than the sample average (7.6 per cent),” the report noted.

- IANS