After four years of high double-digit growth in profits, corporate earnings of Indian companies hit a speed bump in the April-June quarter of 2024 (Q1FY25), leading to the risk of a downward revision in India Inc profit estimates for FY25 and volatility in the equity market. Earnings growth slowed despite companies in most non-financial sectors reporting higher operating margins from lower commodity prices and a decline in interest costs.
A higher-than-expected consumer price inflation (CPI) print for March in the US has dashed hopes of an interest rate cut by the US Federal Reserve (US Fed) in June. Analysts now expect the US central bank to start cutting rates in September, provided inflation remains in check and oil prices remain supportive. The markets, analysts believe, partially factored in this possibility.
Upstream majors ONGC and Oil India (OIL) results for the January-March quarter (Q4) of FY24 suggest better production in future. But OIL missed its own production targets although it delivered higher volumes and it disappointed the market in terms of Ebitda. ONGC reported standalone Ebitda of Rs 17,400 crore (up 7 per cent year-on-year or Y-o-Y) in Q4FY24, slightly below estimates due to other higher expenses.
Do not, however, enter expecting quick returns.
'Our unsecured loan is not exactly unsecured. It is backed by cash flow of customers.'
