Advance tax by firms zooms

Blue chips bullish on growth prospects.

India Inc seems confident of coming up with yet another sparkling show this financial year if the first installment of advance tax paid by companies by June 15 is any indication.

Though the final numbers have not come in and no official confirmation is available, the first installment figures are way ahead of last year's, according to sources.

Tata Steel has paid an advance tax of Rs 265 crore for the first quarter as against Rs 160 crore in the corresponding quarter last year. Reliance has paid Rs 124 crore (Rs 50 crore) and the Aditya Birla Group's Hindalco paid Rs 65 crore (Rs 39 crore).

State Bank of India is believed to have paid an advance tax of Rs 280 crore as against Rs 234 crore and ICICI Bank doubled its payment to Rs 200 crore.

Among other companies, Bajaj Auto paid Rs 52 crore (Rs 40 crore), Mahindra & Mahindra Rs 20 crore (Rs 17 crore), Siemens Rs 40 crore (Rs 6 crore) and ACC paid an advance tax of Rs 10 crore against Rs 6 crore.

Grasim has paid nearly the same amount last year "" Rs 47 crore "" while Reliance Energy paid an advance tax of Rs 7.25 crore as against Rs 6 crore.

Indus Ind Bank is said to have paid advance tax of Rs 15 crore for the first quarter of the current financial year against Rs 14 crore last year.

Analysts feel this only shows that corporate India will carry on with the growth momentum achieved in the last financial year.

"Even though some commodities have cut prices, the robust commodity cycle per se is not yet over. The interest rates continue to be benign. If the monsoon is on track, corporate India would have nothing to worry," said an analyst with a foreign brokerage.

Non-food credit growth in the first two months of the fiscal year is an indication of the health of corporate India. The non-food credit of the banking system went up by Rs 47,350 crore up to May 27 against Rs 15,661 crore in the comparable period last fiscal.

In FY 2004-05, if one were to exclude the refineries, the rest of the manufacturing sector has posted a 55 per cent growth in net profit in fiscal 2004-05. The refineries sector accounts for nearly one-third of the sales and one-fourth of the net profits of the corporate sector as a whole.

The financial aggregates for 1,250 companies in the manufacturing sector, studied here by the Business Standard Research Bureau, show a 21.94 per cent rise in sales and a 34.29 per cent rise in net profit.