Equity investors should thank cash-rich biggies such as TCS, ITC, HUL, Nestl, and Bajaj Auto for this.
Together, the top 10 business groups reported a pre-tax loss of Rs 19,342 crore during the January-March 2020 quarter, as against a profit before tax of around Rs 48,500 crore in the year-ago period and Rs 39,600 crore during the December quarter. While Vedanta was the worst hit. others included Aditya Birla, Bharti, Adani, Mahindra, and Tata.
Though India was under lockdown for only seven days of the quarter, global demand and commodity prices began falling from February as COVID-19 was spreading in other countries. 1,002 listed companies - excluding banks, non-bank lenders, insurers, brokerages, and IT firms - reported a combined pre-tax loss of around Rs 2,700 crore during Q4.
In the last five years, imports from HK have more than tripled -- from $5.6 billion in FY15 to $17.1 billion in FY20. In the same period, exports declined by 20 per cent -- from $13.6 billion in FY15 to $10.8 billion (annualised) in FY20.
The first spending item on the chopping block is capital expenditure, followed by operating costs and overheads, including sales and marketing expenses.
While freight traffic has gone up, the Google location data shows more people are stepping out of their homes.
The trend in corporate earnings suggests that index earnings could fall to the levels last seen in early 2014.
Combined profit before tax of 81 firms down 37.5% y-o-y, worst show in at least 3 years.
RIL, however, remains miles ahead of TCS in other financial parameters such as total revenue, operating profit, net worth, assets, and market capitalisation.
Corporate revenues will decline for a third consecutive quarter in March on a YoY basis - one of the worst shows by these companies in many years.
Indians face COVID-19 with record debt, stalled income.
Profitability and cash reserves have halved since the global financial crisis.
The combined market capitalisation of the top 873 family-owned companies was down 26.3 per cent year-on-year (YoY) to Rs 61.8 trillion at the end of trading on Tuesday. It had grown 6 per cent in FY19 and nearly 20 per cent in FY18.
Some of the top indebted companies likely to face financial headwinds in the coming quarters include NTPC, PowerGrid, Tata Steel, Adani Power, JSW Steel, UPL, and Steel Authority of India. Together these 201 companies owed Rs 14.9 trillion to their lenders at the end of September 30, 2019, up 4.1 per cent year-on-year (YoY) during the first half of FY20.
In the manufacturing sector, output is expected to decline by about 70 per cent as only food-processing, and drugs and pharma industries are allowed to operate while other segments, such as engineering and metals, have shut operations.
Vodafone Idea's net worth (or shareholders' equity) was down 73 per cent year-on-year to around Rs 17,600 crore at the end of the December 2019 quarter after the company reported a net loss of around Rs 6,400 crore during the quarter. Cumulatively, the company has lost nearly Rs 45,000 crore in the last four quarters, eroding its net worth to its lowest level in three-year. Analysts said a such a low level of net worth, coupled with continuing losses in operations, ruled out the possibility of the company getting fresh loans from lenders to fund its adjusted gross revenue (AGR) dues of Rs 54,000 crore.
The Indian rupee is down nearly 2 per cent against the US dollar since the beginning of January 2019. Experts attribute the Indian rupee's relatively poor performance to a sharper-than-expected fall in economic growth in India.
The country's top FMCG stocks, such as Hindustan Unilever, ITC, Nestl, Britannia, Godrej Consumer Products, and Dabur, among others, are currently trading at around 41x their trailing 12-month earnings, down from their peak P/E multiple of around 48x at the end of December 2018.
This is the biggest equity-raising exercise by an Indian corporate within a financial year. The fundraising - led by Citibank, Goldman, Kotak and Axis Capital as bankers - will see participation by foreign and domestic institutional investors.
Richest 10 account for 41% of promoter wealth, up from 33% in December 2018, says Krishna Kant.
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