Ms. Kinjal Shah
Vice President & Co-Group Head - Corporate Ratings, ICRA Ltd
Ms. Kinjal Shah
Vice President & Co-Group Head - Corporate Ratings, ICRA Ltd
Global headwinds continue to weigh on earnings of India Inc.
Corporate India reported a 27% YoY growth in revenues during Q2 FY2023, primarily driven by increased realisation levels on account of input cost inflation, while volume growth was relatively subdued. However, this did not translate into earnings growth, and the operating profit margin (OPM) contracted to multi-year lows of 14.5%, with the commodity inflation, energy cost hikes, forex fluctuations, etc., playing spoilsport. The suppressed earnings and increase in working capital intensity also led to increased reliance on external borrowings by India Inc. during this period.
