The Pain Before Covid-19

Total profits of the Fortune India 500 companies declined nearly 22% over the previous year, while cumulative revenues fell by 1.4%.

- Rajiv Bhuva

THE SHADOW OF COVID-19 continues to hang over India Inc. as companies across sectors navigate the impact of the pandemic. However, that’s not visible in this year’s Fortune India 500 list, which is based on FY20 numbers. But even without the pandemic there are enough pain points, evidence that FY20 was hardly a happy year for Corporate India.

Sample this: The total profit of the 2020 Fortune India 500 companies declined nearly 22% from the year-ago period to around ₹3.6 lakh crore. The only time the list had a lower profit figure than this, at ₹3.3 lakh crore, was in the year the list began—2010, which was the first full fiscal year (FY10) since the 2008-2009 global financial crisis. And there is a simple reason behind such a staggering fall in profits this year: some of India’s largest companies reported losses. For example, telecom majors Vodafone Idea (No. 40 on the list) and Bharti Airtel (No. 20) reported losses of ₹73,878 crore and ₹32,183 crore, respectively, as they had to make provisions for adjusted gross revenue (AGR) dues.