Corporate sector continues to trail India's GDP growth

Even though India's headline economic growth in recent quarters remained robust, that has not helped the corporate sector to grow at a faster pace.

- KRISHNA KANT

Corporate revenues continue to trail the growth in India's gross domestic product (GDP).

The combined net sales of listed companies — non-banking, financial services and insurance (non-BFSI) — grew slower than India's nominal GDP for the ninth quarter in a row during the first quarter of 2025-26 (Q1FY26).

Nominal GDP uses current market prices while real GDP takes constant prices from a base year to adjust for implied inflation in the economy called GDP deflator.

The combined net sales of listed companies, non-BFSI, was up 5.3 per cent year-on-year (Y-o-Y) in Q1FY26 against 8.8 per cent growth in India's nominal GDP in the quarter. For comparison, corporate revenues were up 6.2 per cent Y-o-Y in Q1FY25 against 9.7 per cent growth in India's nominal GDP in the quarter.

In the last nine quarters, India's nominal GDP has grown at more than double the pace of growth reported by companies in the non-financial space. The nominal GDP has grown at 9.6 per cent Y-o-Y on average since Q1FY24, compared to 4.5 per cent Y-o-Y growth in the net sales of non-BFSI companies on average during the period.