India firms’ Q4 recovery has been strong—but lopsided

Rural incomes, easing inflation, GST reforms and festive spending aided demand recovery

- Abhinaba S. Saha

India Inc.’s revenue recovery gathered pace in the March quarter (Q4FY26) as more companies broke out of sluggish single-digit growth and returned to double-digit expansion.

But the rebound was concentrated in premium consumption, infrastructure and capital-market-linked businesses, prompting analysts to caution that recovery remains uneven and could come under pressure if rising inflation starts squeezing demand and margins in FY27.

A Mint analysis of 1,234 companies that have reported earnings showed the share of firms posting 10-20% year-on-year revenue growth rose to 21% in Q4 from 20% in Q1, while those posting 20-50% growth also rose to 21% from 19%. Companies reporting more than 50% growth climbed to nearly 6% from just over 4% during the same period.

Besides, the share of firms reporting a revenue fall eased to 30% in Q4 from 33% in Q1 and 36% in Q2, when weak domestic demand and the US tariff standoff weighed heavily on toplines.

The sharpest improvement came in the slow-growth category. The share of companies reporting 0-10% revenue growth fell to 23% in Q4 after steadily rising from 24% in Q1 to 27% in Q3, indicating that more companies moved into faster growth brackets by the end of FY26.