India inc.’s earnings for the quarter ended March 2023, having crossed the halfway-mark, have largely remained mixed, with no major surprises. The results indicate that global macroeconomic conditions and inflation remain a concern for most businesses. The numbers for Q4FY23 so far show the banking sector leading, with IT firms reporting tepid numbers, while FMCG firms exhibit a positive-to-mixed trend. Automobile and cement firms, meanwhile, have posted in-line performances.
With a 46 per cent year-on-year rise in Q4FY23 consolidated net profit, IndusInd Bank has emerged as the top grosser, while ICICI Bank, HDFC Bank and Kotak Mahindra Bank posted 27.6, 20.6 and 17.3 per cent YoY growth, respectively, in their bottom lines. But Axis Bank—due to its acquisition of Citibank’s India consumer business—posted a consolidated loss of `5,361.85 crore. “Credit growth is at record highs
and net non-performing assets are at record lows. We believe this kind of performance is likely to continue
in the June quarter also,” says G. Chokkalingam, Founder and Head of Research of Equinomics Research
and Advisory.
Among NBFCs, HDFC, Bajaj Finance and Bajaj Finserv reported 18.04, 30.51 and 31.41 per cent YoY
rise in Q4 net profits, respectively. Overall, the early-bird results (excluding BFSI) for Q4FY23 for 19 Nifty 50 companies reported a 8 per cent YoY growth in consolidated revenues, while net profits declined by 4.77 per cent, based on the results reported till May 8.
Elsewhere, IT majors TCS, Infosys and Tech Mahindra missed street estimates, with TCS, Infosys and HCL Technologies reporting 14.77, 7.77 and 10.85 per cent YoY growth in net profits, respectively. Net profit of Tech Mahindra and Wipro de-grew by 25.77 and 0.41 per cent YoY, respectively. The management of TCS talked about increasing near-term uncertainty in the overall demand environment driven by weak global macros and the ongoing concern in American banks that has led to delayed decision-making for new orders. Independent market analyst Ambareesh Baliga says: “IT sector earnings were mostly disappointing, more so the commentary of the management. The global slowdown is expected to have an impact over the next few quarters.”
In the automobile space, Maruti Suzuki, Hero MotoCorp and Bajaj Auto posted 42.38, 31.70 and 11.70 per cent YoY rise in net profits, respectively. Net profits of FMCG majors Nestlé, Tata Consumer Products and Hindustan Unilever jumped by 24.69, 23.47 and 12.85 per cent, respectively.
Reliance Industries witnessed a 19 per cent YoY rise in net profit at Rs 19,299 crore, and revenue growth at 2.8 per cent to `2.39 lakh crore, while Adani Enterprises’ net profit jumped 137 per cent, and net profit
of Tata Steel declined sharply by 82.53 per cent YoY to `1,704.86 crore.
Commenting on the results for the quarter, Nirvi Ashar, Fundamental Analyst at Religare Broking, says,
“FMCG is seeing a positive to mixed trend, while banking has posted in-line numbers. However, the major disappointment was from the IT pack, where the outcomes were below expectations. The Q4FY23 earnings outcome has largely been mixed to muted for now.”
@iamrahuloberoi
