CORPORATE SALES TO GROW, PROFITS TO FALTER IN Q2 FY 09: CMIE

Mumbai, October 06, 2008
The Economic Times Financial Chronicle Mint The Pioneer

Corporate India is expected to report a 28.4 percent rise in sales during Q2 FY 09, the Centre for Monitoring Indian Economy (CMIE) said in its monthly report here.

Although a tad lower than the 32.5 percent rise in the June 2008 quarter, sales growth during July-September 2008 is going to be the second-highest quarterly growth in at least the last 11 years, CMIE said.

"We expect a growth in Q2 FY 09 to be driven by a handsome 33.9 percent rise in net sales of the manufacturing sector and 52.6 percent and 42 percent rise in the income of the crude oil and construction sectors, respectively," it said.

Sectors like electricity, banking and real estate are expected to grow by less than 25 percent.

Non-financial services like hotels, recreation, health, trading, transport, communication and IT are collectively expected to report a 25.6 percent rise in sales in the September 2008 quarter, it said.

"We believe that the Indian corporate sector will once again fail to translate the impressive sales growth into a healthy profit growth. Corporate India's net profits are expected to decline by 28 percent in the September 2008 quarter.

The main culprit behind the steep fall in profits would be the refineries, which are expected to incur net losses of Rs 19,897-crore in the September 2008 quarter," the report stated.