Despite significant input cost pressure, manufacturing companies' net profits increased by 50.2 per cent during 2021-22, the RBI said on Friday. RBI said net profits for IT companies also increased, whereas non-IT services continued to record losses at the aggregate level, Moneycontrol reported.
The data on the performance of the private corporate sector during 2021–22 was drawn from abridged financial results of 3,166 listed non-government non-financial (NGNF) companies. Operating profit margins remained healthy for all three sectors. Net profit margins remained stable for manufacturing and IT companies, whereas it remained in the negative terrain for non-IT services companies.
The data further showed that private corporate sales and profitability recorded healthy growth in during 2021-22 as the effects of the COVID-19 pandemic subsided and economic activity recovered, especially in the second half of the year.
"Sales of 1,865 listed private manufacturing companies witnessed broad-based recovery and expanded by 36.7 percent during 2021-22 as compared with a contraction of 2.8 per cent in the preceding year; both volume and price components contributed to the higher growth and it was also aided by favourable base effects," RBI said.
IT companies also improved their performance, and their sales growth accelerated to 19.8 per cent from 4.4 per cent in the previous year. Sales in the non-IT services sector made a broad-based recovery in 2021-22, registering a 27.2 per cent annual expansion as against a 14.6 per cent decline in the previous year.
On expenditure, the RBI said: "Consistent with the rise in production and sales, manufacturing companies' expenditure on raw materials increased by 48.6 per cent during the year and its share in their total sales increased." Unlike manufacturing and the non-IT sector, which witnessed a turnaround during 2021-22 from the pandemic-led contraction in sales and staff costs in the previous year, the IT sector weathered the successive waves of the pandemic and logged sustained growth in both these parameters, it added.