India Inc’s sales growth slowed in the first half of the current financial year, the Reserve Bank of India (RBI) said on Wednesday.
“Sales growth (on a year-on-year basis) moderated in the first half of 2012-13. The moderation was deeper in the second quarter than in the first. In the first half, sales contracted for smaller companies with annualised sales below Rs 100 crore,” the banking regulator said in a statement after evaluating the financial results of 2,832 listed non-government non-financial companies.
Domestic companies’ sales growth in the first six months was estimated at 12.3 per cent. While in the first three months, growth was 13.4 per cent, it slowed to 11.3 per cent in July-September quarter. The operating profits of these companies were also lower in the first half from a year ago, even though it improved in the second quarter. Information technology (IT) companies performed better than their manufacturing and non-IT services rivals. In the first six months of 2012-13, the IT sector maintained its net profit margin at above 17 per cent, while it was 5.7 per cent for the manufacturing sector and 4.9 per cent for non-IT services firms. Net profit margin, in aggregate terms, was impacted by the weak performance of small companies with annualised sales below Rs 100 crore.