March quarter results of close to 600 companies that reported their numbers till May 15 show a marginal revival of 7% in the
y-o-y sales growth even as the aggregate earnings fell about 0.9% compared to last year.
However, a further examination of results of a subset of 150 companies (for which estimates are available) indicates that the topline numbers brought in a meaningful positive surprise of 5.5% although the Street estimates had factored in a larger hit due to the economic slowdown.
Aggregate net profit for these 150 companies, however, appears in line with expectations, with only a marginal 0.5% positive surprise seen.
Not surprisingly, March quarter numbers threw up more negative surprises with as many as 56% of the 150 companies failing to meet the earnings estimates. The extent of misses remained high for companies from metals, infra and financials space with names like Ballarpur Industries, Dena Bank, and Tata Sponge Iron missing adjusted earnings estimates by more than 50%.
GVK Power & Infra was one of the biggest disappointments as it reported a quarterly loss of R171 crore against consensus loss estimates of R30 crore. UCO Bank, United Bank of India, Indian Overseas Bank and SKS Microfinance failed to meet earnings expectations by 98% to 65%.
Revenue disappointments, however, appear to be spread across industries as even consumption-driven names like Whirlpool India, Elder Pharma, Tata Coffee and Ranbaxy fell short of volume growth expectations by a range of 9% to 28%.
Some of the troubled companies from the infra and telecom space made a comeback in terms of earnings. Adjusted earnings of Ashoka Buildcon, Jaypee Infratech and Adani Port & SEZ for the quarter beat Street estimates.
Interestingly, flagship ADAG group companies, Reliance Power, Reliance Infra and Reliance Communications, managed to outdo the market anticipation in terms of adjusted earnings. However, in case of Reliance Communication, the net profit was aided by a surge in the other income to R826 crore.
