India Inc's profit-to-GDP at 4-year high of 2.6% in FY21 despite pandemic

ICICI Securities says impact of GDP weakness felt more by unorganised sector

Despite the havoc created by the covid-19 pandemic, listed companies’ net profit as a percentage of the gross domestic product (GDP) has hit a four-year high at 2.6 per cent for the financial year 2020-21 (FY21). During the last quarter of FY21, the net profit of India’s top 200 companies more than doubled led by strong earnings posted by cyclical stocks.

In FY20, the profit-to-GDP ratio had dropped to two-decade low of 1.8 per cent. The increase in the ratio for FY21 signals that the unlisted or unorganized players had to bear the maximum burnt of the pandemic.

“The key