Sales growth of IT sector companies accelerated to 6.4 percent in Q4FY21.
July 16, 2021 / 06:45 PM IST
Manufacturing companies increased their expenditure on raw materials in tandem with the rise in sales during Q4FY21.
Sales of 1,633 manufacturing companies surged by 31 percent year-on-year (y-o-y) in the January-March quarter of FY21, as compared with 7.4 percent growth in the previous quarter, the Reserve Bank of India (RBI) said on July 16. The rise in sales was broad based, and was supported by favourable base effect as well as price effect, the central bank added.
Sales growth of information technology (IT) sector companies accelerated to 6.4 percent y-o-y in Q4FY21. Sales of non-IT services companies recorded a marginal growth after declining in the previous three quarters. The improvement was largely led by trading companies, the RBI said.
Manufacturing companies increased their expenditure on raw materials in tandem with the rise in sales during Q4FY21. Staff cost growth increased for manufacturing companies and remained steady for IT companies during the quarter, whereas it remained in the contraction zone for non-IT services.
Operating profits of manufacturing companies accelerated in the fourth quarter on the back of higher rise in sales compared to that in expenditure. Operating profits of services sector companies — both IT and non-IT — also expanded.
With rise in profits and persistent reduction in interest outgo, interest coverage ratio (ICR) of manufacturing companies improved to 7.3 in Q4FY21 from 6.6 in the previous quarter. The ICR of non-IT services companies remained below unity, the central bank said, adding that operating profit margins remained stable across sectors during the quarter.
The data on the performance of the private corporate sector during the fourth quarter of 2020-21 released by the RBI was drawn from abridged quarterly financial results of 2,608 listed non-government non-financial companies.