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The Economic Times - - Companies - RAMKRISHNA KASHELKAR

In­dia Inc’s fourth-quar­ter re­port card keeps get­ting bet­ter as more com­pa­nies an­nounce re­sults, sup­port­ing the bullish mar­ket sen­ti­ment as a new govern­ment takes over in New Delhi. Nearly 1,200 com­pa­nies have so far un­veiled earn­ings and an anal­y­sis by the ET In­tel­li­gence Group sug­gests that ag­gre­gate quar­terly prof­its have jumped the high­est in at least two years, with op­er­at­ing profit mar­gins at a three­year high. The Jan­uary-March pe­riod could well turn out to be a wa­ter­shed for In­dia Inc. “We are past the worst in terms of quar­terly earn­ings,” said Gau­tam Trivedi, man­ag­ing di­rec­tor and head of eq­ui­ties, Reli­gare Cap­i­tal. “In that sense, the March 2014 quar­ter was a turn­around quar­ter for In­dia Inc.” Ag­gre­gate net profit of 965 com­pa­nies, ex­clud­ing petroleum and bank­ing and fi­nance, showed a strong 62.2% YoY growth dur­ing the quar­ter. This was sup­ported by healthy 17.5% rev­enue growth cou­pled with op­er­at­ing profit mar­gin at a three-year record of 18.4%. Op­er­at­ing profit was up 46.5% from the year ago. The in­crease in in­ter­est and de­pre­ci­a­tion costs lagged be­hind this, thereby boost­ing net profit growth. Tata Steel proved the sin­gle largest in­flu­encer, with the com­pany post­ing a net profit of .` 1,036 crore com­pared with the year-ago loss of .` 6,528 crore. Even ex­clud­ing that, ag­gre­gate net profit growth was 28.7% from the year ear­lier for the re­main­ing 964 com­pa­nies that were cov­ered in this ex­er­cise. Earn­ings at a large num­ber of In­dian com­pa­nies across sec­tors ex­ceeded ex­pec­ta­tions. “The key dif­fer­ence this quar­ter is the num­ber of com­pa­nies per­form­ing bet­ter than es­ti­mates far out­num­ber those with in line or be­low ex­pec­ta­tions. This is a sign of the econ­omy bot­tom­ing out and mov­ing onto a path of re­cov­ery,” said San­deep Nayak, ex­ec­u­tive di­rec­tor and CEO, Cen­trum Broking. One in ev­ery five com­pa­nies has seen net profit at least dou­ble or swing back from a

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