India Inc's net profit growth in 2002-2003 could turn out to be its highest in the last five years.
So far, 1,075 companies, excluding banks and financial institutions, have reported their financial results for the year.
These companies have reported a 27.9 per cent rise in net profit during 2002-2003. Net profit had declined last year.
Major refinery and steel companies are yet to declare their financial results for the year. Once their results are in, corporate India may post more than a 30 per cent rise in its bottomline for 2002-2003.
Of these 1,075 companies, Business Standard Research Bureau has data for the last five financial years on 850 companies.
This common sample reported a 26.6 per cent rise in net profit in 2002-2003 against a 0.44 per cent drop in the previous year.
In fact, in 1999-2000, this common sample of companies reported a 13.21 per cent increase in its bottomline, followed by another 13.21 per cent rise in net profit in 2000-2001.
What primarily drove net profit growth in 2002-2003 to such levels was the improvement in the fortunes of the so-called old economy companies.
Most companies in the alkalies, auto ancillaries, fertilisers, forging, glass, lubricants, non-ferrous metals, pharmaceuticals, pumps and compressors, refineries and steel industries posted their highest net profit growth in the last five years in 2002-2003.
Companies in the power and steel industries posted an exemplary turnaround in 2002-2003.
Companies in the non-ferrous metals industry posted a neat 100 per cent growth in their bottomline during 2002-2003. In the previous two years, they posted consistent declines in net profit.
Similarly, auto ancillary companies reported for the first time a 70 per cent growth in net profit, while six forging companies recorded a huge 1,600 per cent growth in aggregate net profit to Rs 95.75 crore (Rs 957 million) in 2002-2003, up from a net profit of Rs 5.12 crore (Rs 51.2 million) in the previous year.
The deregulation of the petroleum industry in April, 2002 boosted the fortunes of the domestic refinery companies and enabled them to post higher net profits during the year.
Kochi Refineries posted a 563 per cent jump in net profit to Rs 456 crore (Rs 4.56 billion), against only Rs 68.77 crore (Rs 687.7 million) in the previous year.
Gas Authority of India reported its highest ever net profit of Rs 1,607.01 crore (Rs 16.07 billion) for 2002-2003, a 36 per cent increase from its net profit of Rs 1,185.84 crore (Rs 11.85 billion) in the previous year.
Apollo Tyres' net profit crossed the magical Rs 100 crore (Rs 1 billion) mark in 2002-2003 to Rs 120.02 crore (Rs 1.2 billion) after the company clocked a record sales turnover of Rs 2,025.62 crore (Rs 20.26 billion).
National Fertilisers is another company which reported its highest ever net profit in the last five years, namely, Rs 294.51 crore (Rs 2.94 billion).
Bharat Forge, Century Enka, Century Textiles, Exide Industries, Hindustan Zinc, Indian Rayon, Indo Rama Synthetic, Jindal Strips, Nicholas Piramal, Sterlite Industries, Tata Chemicals, TVS Motor are the other major companies which posted their highest net profit growth during 2002-2003.
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