Mumbai: A lower base in the previous year’s quarter and likely good show by select companies in sectors such as automobiles, capital goods, FMCG, IT, and metals should help the Nifty 50 companies report a double-digit growth in aggregate sales and profits for the June 2018 quarter. According to the ET Intelligence Group’s estimates, net sales is likely to increase by 12.1 per cent and net profit by 13.5 per cent year-on-year. Sales and profit will grow in double- digits for the fifth and third consecutive quarters, respectively.
The corporate performance in the June 2018 quarter will get a leg up given relatively muted performance in the year-ago quarter. This was because of lower inventories of companies in the June 2017 quarter ahead of the implementation of the Goods and Services Tax (GST) on July 1, 2017. Subsequently, net profit of the sample grew marginally by 1.8 per cent during the year-ago quarter on sales growth of 10 per cent while the operating profit fell by 1.3 per cent.
Operating profit for the June 2018 quarter is likely to grow by 15 per cent, the highest growth in at least nine quarters. In addition, the operating margin is expected to improve by 180 basis points year-onyear to 20.2 per cent.
For investors, the quarter will be crucial in deciding whether an overall turnaround will be in sight amid headwinds of strong crude oil prices, a weakening rupee, rising inflation and hardening interest rates.
