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India Inc. has kicked off FY27 on a stronger-than-expected note. Revenue of 838 listed companies tracked by ICRA jumped 22% year-on-year in Q1, up sharply from 13% growth in the previous quarter. In simple terms: companies sold more, and in some cases, higher commodity and gold prices also pushed up the value of what they sold.
Automobiles were the star performer, with passenger vehicle makers clocking over 25% revenue growth. FMCG, consumer durables, apparel, grocery and jewellery retailers, and quick-service restaurants also saw healthy demand. Government spending helped too, with Centre’s capex rising 24% to ₹3.4 lakh crore in Q1, particularly benefiting areas like railways, defence, data centres and electronics.
But there’s a catch: higher sales didn’t automatically mean higher profits. Overall operating margins fell by more than 2 percentage points, while net profits were largely flat, mainly because oil refiners were squeezed by high crude prices and LPG under-recoveries.
Strip out oil & gas, though, and the picture looks much rosier: margins held at around 19% and profits grew over 20%. Looking ahead, West Asia tensions, volatile oil prices and global trade uncertainty remain potential risks risks. Still, strong corporate balance sheets and the upcoming festive season could give consumption and auto companies another boost.
