Weighed down by the rising cost of production and slowdown in sales, 1,638 companies that have so far declared their results for the quarter increased their net profits by just 10.8 per cent against over 15 per cent growth reported in the previous eight quarters. The sample excludes banks and financial services companies.

These companies' aggregate net profits increased from Rs 38,296 crore (Rs 382.96 billion) to Rs 42,432 crore (Rs 424.32 billion) and net sales increased by 24 per cent to Rs 4,86,068 crore (Rs 3,91,060 crore) for the quarter.

The state-owned oil marketing, power and engineering firms were the main laggards. For example, Indian Oil Corporation [Get Quote], Hindustan Petroleum Corporation Ltd [Get Quote] (HPCL), National Thermal Power [Get Quote] Corporation (NTPC) and Bharat Heavy Electricals Ltd [Get Quote] (BHEL) reported a combined 51 per cent drop in net profit.

The aggregate net profit of these four public sector firms declined from Rs 4,937 crore (Rs 49.37 billion) to Rs 2,421 crore (Rs 24.21 billion) during the quarter. BHEL, HPCL and NTPC reported fall in their net profit, and IOC posted net loss of Rs 414 crore (Rs 4.14 billion) after a gap of eight quarters.

If these four companies are excluded from the sample, India Inc's net profit growth would improve to 20 per cent for the quarter. That doesn't mean that other companies are not feeling the impact of a slowdown.

Nearly half the companies (765 companies) reported losses or a drop in net profit growth during the quarter. While 124 firms reported a turnaround, 76 just managed to post single-digit growth.

If you are looking for winning strategies in a bear market, here's an interesting takeaway: smaller firms have performed much better than their bigger counterparts (see table).

Companies in refineries, electric equipment, automobiles, commercial vehicles and personal care products posted decline in net profits while firms in IT, power, aluminium, pharma and cigarettes have reported single-digit growth.

Companies in mining, private engineering, electronics, metals - copper and zinc, steel, sponge iron - and construction outperformed the others and reported over 30 per cent growth in net profit during the quarter.