New Delhi, 16 June (IANS). According to a report released by the rating agency ICRA on Monday, after gradual improvement in the last few quarters, the operating benefits of Indian companies in the first quarter of FY 2026 (April-June) can increase by 18.2 to 18.5 percent with an increase of 10 to 40 basis points.
“The interest coverage ratio for India companies will increase by about 5.1–5.2 times in the first quarter of FY 2026, while it was 5.0 times in the fourth quarter of FY 2025,” the report said the report said the report said.
Senior ICRA Vice President Kinjal Shah said, “Given the uncertain global atmosphere, private capital expenditure (capex) is expected to be measured to be measured. However, in some emerging areas like electronics, semiconductor and electric vehicles in emerging area and automotive spaces, there will be an increase in investment in linked segments, which are in line with various production-line encourages announced by the Government of India.”
He said, “Apart from this, institutions associated with Indian Railways and Defense Areas will also see the benefit of their big order book with revenue and income.”
The ICRA analysis of performance of 589 listed companies (except financial sector institutions) in the fourth quarter of FY 2025 showed that companies have increased by 7.6 percent of the revenue on an annual basis.
On the other hand, there was some decline in sectors like iron and steel after low receipts due to weak global demand and cheap imports from China.
The report further stated that Indian companies expect stable revenue growth in the first quarter of FY 2026, which supports strong domestic demand, while rural demand is expected to be healthy and urban demand is expected to improve.
However, current geopolitical stresses continue to affect demand sensations for export-oriented areas such as agro-chemicals, textiles, auto and auto components, chopped and polished diamonds and IT services.
Corporate India recorded an increase of 63 base points on an annual basis in the operating profit margin in the fourth quarter of FY 2025, which increased to 18.5 percent.
The expansion occurred due to some decrease in input costs as well as some reduction in input costs due to strong demands led by sector leaders such as Power, Airlines and Real Estate.
In addition, on a gradual basis, the margin improved about 41 basis points in the fourth quarter of FY 2025.
In the financial year 2025 in the industrial, capital goods and construction sector, the range-bound date level, along with better profitability of Indian companies, improved gearing and total loans compared to operating benefits before interest, tax and depreciation.
-IANS
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