ANI
23 Jun 2022, 11:33 GMT+10
New Delhi [India], June 23 (ANI): The corporate profit to Gross Domestic Product (GDP) ratio rebounded to a decade high of 4.3 per cent and 4.5 per cent for the Nifty-500 universe and listed India companies, respectively, brokerage house Motilal Oswal Financial Services said in a report.
The recovery was driven by the expansion in the economy, after a Covid-led contraction in 2021, while corporate profit rose at a faster rate of 48 per cent year-on-year for the Nifty 500 companies.
"The growth in profit, however, was hardly broad-based and driven only by three sectors: BFSI, oil and gas (OG), and metals. More than half of the incremental growth was steered by BFSI, underpinned by a modest revival in credit growth and improvement in asset quality trends," it said.
Notably, India's corporate profit, listed and unlisted companies combined, to GDP ratio fell to 2.2 per cent from 7.8 per cent during 2008-20 period, the report said.
On the outlook, the brokerage expects the improvement in corporate profit to GDP to sustain going ahead.
"India's earnings cycle has seen a turnaround after almost a decade; the current adverse macroeconomic backdrop with heightened worries on rising interest rates, elevated crude oil prices and liquidity tightening has kept the market volatile and jittery. Meanwhile, the domestic earnings continue to remain healthy and provide a silver lining, notwithstanding the challenges faced on multiple fronts."After 15 per cent and 35 per cent growth in earnings per share in Nifty in financial year FY21 and FY22, respectively, it is expected to grow at 18 per cent in FY23.
Though the risks to earnings are tilted towards downside, the brokerage house, however, expects the profit to GDP ratio to improve both in the short as well as medium term. (ANI)Get a daily dose of Florida Statesman news through our daily email, its complimentary and keeps you fully up to date with world and business news as well.
Publish news of your business, community or sports group, personnel appointments, major event and more by submitting a news release to Florida Statesman.
More InformationMOSCOW, Russia: Just hours after his sudden dismissal by President Vladimir Putin, Russia's former transport minister, Roman Starovoit,...
DHARAMSHALA, India: The Dalai Lama turned 90 on July 6, celebrated by thousands of followers in the Himalayan town of Dharamshala,...
ZAGREB, Croatia: A massive concert by popular Croatian singer Marko Perković, known by his stage name Thompson, has drawn widespread...
WASHINGTON, D.C.: Elon Musk's entry into the political arena is drawing pushback from top U.S. officials and investors, as his decision...
CULVER CITY, California: TikTok is preparing to roll out a separate version of its app for U.S. users, as efforts to secure a sale...
WASHINGTON, D.C.: President Donald Trump claimed he was unaware that the term shylock is regarded as antisemitic when he used it in...
LONDON, U.K.: This week, BP appointed Simon Henry, former Shell finance chief, to its board as a non-executive director effective September...
OTTAWA, Canada: With Canada Post struggling to maintain operations amid labour unrest, rivals like FedEx and UPS are stepping in to...
NEW YORK, New York - U.S. and global markets showed a mixed performance in Tuesday's trading session, with some indices edging higher...
PARIS, France: French military and intelligence officials have accused China of orchestrating a covert campaign to damage the reputation...
NEW DELHI, India: Birkenstock is stepping up its efforts to protect its iconic sandals in India, as local legal representatives conducted...
HONG KONG: China has fired back at the European Union in an escalating trade dispute by imposing new restrictions on medical device...