A mixed bag

Initial Q2 results show volume growth but margins under pressure

An analysis of 300 listed companies which have submitted their results for the July-September 2018 quarter shows growth in sales but increased pressure on margins. Raw material costs are up, and so is the cost of finance. It is important to note here that the introduction of the goods and services tax (GST) in July 2017 created unusual base effects. Net sales are up 24 per cent at Rs4.6 trillion over the corresponding quarter of 2017-18. Similarly, adjusted profit after tax has risen by 18 per cent to Rs 666 billion. Operating profits (that is, earnings before interest, tax, depreciation