This refers to ‘Early-bird results point to poor profit growth in Q3’, January 19. On reading the story, what strikes you is that if the sales growth is robust (nearly a 30 per cent growth with MMTC and 22 per cent without it) and the margins are equally good (14 per cent), perhaps the problem is not as great as is being made out. The biggest fear so far, globally as well as in India, is that demand has disappeared — such demand growth suggests the problem is more of a cost-side one. This could be related to the high-commodity prices, but this is now in the past.
Also, the table shows that profits fell nearly 15 per cent in the previous quarter — so, even by this reckoning, the ‘fall’ in Q3 shows a slowing of the bad news. Things could indeed get worse once more numbers come in, but you would have done well to point out the mitigating factors as well — intact demand and a commodity cycle that is now on our side.
No one expects news to suddenly reflect cheer after such a big global problem, but it is important not to lose perspective and not to dampen spirits unnecessarily. All data, especially that in India, deals with the past — newspapers such as yours have to keep pointing that out.
Sanjay Singh, New Delhi
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