The 150 companies that have so far declared their financial results for the quarter ended September 2004 have posted a 30.7 per cent rise in sales and a healthy 58.1 per cent rise in net profit.
Consequently, profit margins have improved. Their operating profit margin is up 20 basis points to 18.09 per cent in September, while their net profit margin is up a solid 178 basis points to 9.44 per cent.
The strong resurgence in profit growth is not driven by the headline-grabbing software companies. Beating the software firms, companies in the trading, petrochemicals, shipping and automobile ancillary sectors have all posted over 100 per cent growth in net profit.
Also, a smart turnaround in a few steel, cement and glass companies has pushed up the profit growth rate. Leading the charge are Mercator Lines (net profit up 276 per cent), Samtel Colour (up 369 per cent), Indian Seamless Steel (up 820 per cent) and Varun Shipping (up 315 per cent).
The 21 companies in the technology sector account for over 50 per cent of the total net profits logged by the full sample.
These techies posted a net profit growth of 56.8 per cent, year-on-year, on the back of a solid 40 per cent topline growth. Wipro, Infosys Technologies, Hughes Software and CMC each clocked over 50 per cent rise in net profit.
Trading firms are on a profit curve on the back of huge export turnover. MMTC posted 155 per cent growth in net profit to Rs 27.77 crore (Rs 277 million) in the quarter, while Rajesh Exports reported 40.7 per cent growth in net profit to Rs 7.67 crore (Rs 76.7 million).
EID Parry, which is in the sugar and bio-products business, posted Rs 25.37 crore (Rs 253.7 million) as against Rs 0.25 crore in the second quarter last year. For IPCL, a Reliance group petrochemicals company, the figure was Rs 138 crore (Rs 1.38 billion) as against Rs 63 crore (Rs 630 million).
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