Companies in cyclical sectors see large positive swing in Q2 earnings

Analysts say that while the bottom line was hit by cost pressures, demand growth was impacted by a rise in interest rates and much more

The recent changes in India’s macroeconomic environment have begun to weigh on corporate growth and earnings. While earnings of Nifty 50 index companies have grown 14.7 per cent, it is a bounty from higher commodity prices and improved performance of financials. Excluding financials, energy and metal and mining sectors, combined earnings of the remaining 28 companies declined by 3.1 per cent year-on-year (YoY) during the July-September 2018 quarter, the worst in the last five quarters. In rupee terms, the combined quarterly net profit for these 28 companies is flat at around Rs 400 billion over the last two years. 

Earnings