India, Inc. shines in Dec quarter

India Inc has started 2007 with a bang. The first 250 quarterly results (which include 100 BSE-500 companies) for the quarter ended December 2006 show a combined net sales growth of 42% YoY as compared to 21% growth in Q3 FY05. On the net profit front, the result is even more impressive, with the 250 companies together clocking a PAT growth of 70% as against 20% reported in the corresponding quarter of the previous year.

On the turnover front, top honours were taken by Reliance Industries (RIL) which posted a massive 46% growth in net sales, aided by higher-than-expected refining margins owing to huge discounts received on ultra heavy crude oil. Base effect, too, played its part, as RIL���s topline growth in the December quarter of the previous year was just 2%.

RIL alone contributed for 30% of the total net sales growth posted by these companies. Sterlite Industries followed next with a net sales jump of 94% for Q3 FY07, on the back of 78% growth reported in the corresponding quarter of the previous year. The company recorded its highest ever copper cathode production of 86,000 tonnes which, added to better realisations in copper, zinc and aluminium businesses, helped it maintain this robust growth rate.

TCS was the next biggest contributor to the growth, posting more than $1 billion in revenues for the quarter and clocking a net sales growth rate of 49%. Hindustan Zinc followed close with a whopping 171% topline growth for the quarter as compared to 60% growth reported in Q3 FY06.

This growth was largely accounted for by more than 150% hike in zinc prices. Wipro, Infosys and Siemens followed next with growth rates of 44%, 44% and 91% respectively. Around 95 companies reported more than 40% net sales growth rate while just 35 companies reported a decline in sales.

Tech Mahindra, Shree Cement and SpiceJet were among the high performers with net sales growths of 131%, 153% and 102%, respectively. On the other hand, HCL Technologies and Raymonds reported net sales decline of 10%
and 14% respectively.

On the PAT front, RIL, Hindustan Zinc and Sterlite together accounted for around 50% of the total growth. The IT majors (TCS, Infosys and Wipro) followed next accounting for a further 15% of the overall net profit growth. RIL, which had reported a decline of 15% in PAT for Q3 FY06, came back strongly with 58% growth for the quarter. Hindustan Zinc and Sterlite continued enjoying better pricing to post net profit jumps of 306% and 226% respectively.

The IT majors, too, reported PAT growths in 40-50% range. Around 115 companies posted a net profit growth in excess of 40% while 70 of them reported triple digit growth rates. However, around 70 companies reported a decline. The pharma stocks jumped back on base effect with Ranbaxy, Nicholas Piramal and Panacea Biotech reporting PAT jumps of 357%, 495% and 422% respectively.