India Inc records 50% net profits

By agencies   |   Monday, 30 May 2005, 07:00 Hrs
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NEW DELHI: Corporate India continues to shine, with over 50 percent growth in its net profit for the second year in a row. A total of 1325 companies, which have declared their full-year results for 2004-05, posted 54.81percent growth in net profit.

In 2003-04, the growth was 59. 1 percent.

The growth in 2004-05 profit has been driven by a solid 25. 64 percent rise in net sales income. The profit margins-operating, gross and net-grew by over 100 basis points each.

While operating margins went up from 16. 43 percent in 2003-04 to 17. 45 percent in 2004-05, gross profit margins moved up from 13. 67 percent to 15. 34 percent and net margins up from 7. 11 percent to 8. 79 percent in the corresponding period.

Of the 112 sectors studied, as many as 42 posted over 25 percent sales growth compared with the previous year and only eight reported a marginal declines in sales volumes. Net profit doubled in 24 sectors but declined in 22 others.

The housing construction sector was the star performer with a whopping 938 percent rise in net profit, the others being picture tubes (860. 4 percent), office equipment (705. 2 percent), sponge and pig iron (589. 3 percent) and sugar (573. 8 percent).

Among the major industries, net profit grew 152. 2 percent in the composite and alloy steel sector, 107. 2 percent in shipping and 69. 5 percent in the cold rolled steel sector.

Aluminium companies reported a 57. 3 percent surge in net profit, followed by electrical equipment (52. 4 percent), commercial vehicles (50. 2 percent), telecommunications (37. 5 percent) and information technology (35. 8 percent).

The two-wheeler and pharmaceutical industries recorded single-digit growth in net profit at 8. 2 percent and 4. 5 percent, respectively.

The sponge and pig iron sector topped the sales growth chart at 87. 5 percent while the relatively small carbon black industry ranked second with 84. 3 percent sales growth.

Hot-rolled and cold-rolled steel companies came third (70. 4 percent), followed by power cables (67. 8 percent), textile machinery (58. 7 percent), shipping (50. 7 percent) and steel strips, bars and wires (50. 1 percent).

Among the major industries, composite and alloy steel clocked 37. 1 percent increase in sales, followed by commercial vehicles (35. 6 percent), information technology (32. 5 percent), diversified (24. 7 percent) and refineries (24. 3 percent).

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