India Inc's profit-to-GDP ratio rebounds to highest in a decade

Huge improvement in share to 4% from just 1.6% in FY20, shows study by ICICI Securities

Listed companies’ net profit as a percentage of gross domestic product (GDP) has hit a decadal high and is expected to edge even higher over the next two financial years.

According to an analysis by ICICI Securities, India’s Inc net profit stood at Rs 8.4 trillion, or 4 per cent of GDP of Rs 210 trillion for the trailing 12-month period ending September. This is the highest since financial year 2011-12 (FY12), when it was at 4.6 per cent.

Interestingly, the ratio has seen a remarkable turnaround since FY20, when India Inc’s profit contribution to the country’s GDP had plunged to 1.6