India Inc Growth Stuck in Slow Lane

Core earnings shrink in Q1; net profit growth fastest in 5 quarters

- Krishna Kant

The more things change, the more they remain the same for corporate India. In the April-June 2025 period (Q1FY26) — for the ninth consecutive quarter — listed companies witnessed only single-digit revenue growth, while their core earnings, excluding other income and one-time gains, contracted for the second time in four quarters. This comes as firms brace for the impact of 50 per cent US tariff on Indian goods.

The weakness was broad-based in Q1FY26, with the exception of energy-intensive commodity producers such as steelmakers, cement firms, and oil-marketing companies. Benefiting from lower energy costs, they managed double-digit profit growth despite subdued revenues. By contrast, India Inc's key earnings engines — the firms in the banking, IT services, fast-moving consumer goods, automobile, pharmaceutical, and power sectors — reported muted growth in both sales and profits.

The combined net profit (adjusted for exceptional gains and losses) of 3,031 listed firms declaring results rose 9.4 per cent year-on-year in Q1FY26, the fastest pace in five quarters.