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India Inc revenue likely grew 18-20% on-year in 2nd quarter

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4 years ago

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Higher commodity prices and continued revival in demand for consumer discretionary products likely lifted corporate revenue 18-20 per cent on-year to Rs 8.2 lakh crore in the second quarter of this fiscal, indicates a CRISIL Research study of 300 companies (excluding from the financial services and oil sectors) that account for 55-60 per cent of the market capitalisation of the National Stock Exchange.

Revenue from consumer discretionary products such as automobiles likely spurted 19-21 per cent on-year, aided by higher realisations and volume.

Construction-linked sectors are estimated to have grown 22-25 per cent on-year, benefiting from the low-base effect of last fiscal.

Overall revenue growth would be primarily supported by price hikes driven by costlier commodities. On-year volume growth would be mostly in single digit across key segments except commercial vehicles. To be sure, growth momentum would have slowed compared with the 47 per cent on-year increase seen in the first quarter.

On a sequential basis, overall revenue is likely to have grown 8-10 per cent.

Revenue from consumer discretionary products is expected to have risen 23-25 per cent sequentially after demand was hit by the second wave of the Covid-19 pandemic in the first quarter.

Construction-linked sectors are estimated to have grown a moderate 3-5 per cent as seasonal weakness slowed down execution and volume growth.

Revenue in the automobiles sector is estimated to have grown 27-30 per cent sequentially, led by an increase in realisations. That, in turn, is expected to steer growth for ancillary segments such as auto components and tyres, which have likely grown a robust 12-14 per cent and 6-10 per cent on-quarter, respectively.

Overall revenue of the sample set is expected to have risen to Rs 15.8 lakh crore in the first half of this fiscal, up 30- 32 per cent on-year.

Says Hetal Gandhi, Director, CRISIL Research, “Elevated commodity prices and healthy realisations would lead to better revenue performance across sectors in the second quarter. As many as 24 of the 40 sectors represented by these 300 companies have likely grown over 20 per cent on-year. But overall revenue growth would be a notch lower at 15-17 per cent excluding commodity sectors such as steel and aluminium. On a sequential basis, it could be even lower at 8-10 per cent, with export-linked sectors such as IT services and pharmaceuticals proving to be drags, even though growing at a stable 4-6 per cent.”

The moderation in revenue growth is expected to have trickled down to earnings before interest, tax, depreciation, and amortisation (Ebitda), which is estimated to be up an average 5-7 per cent sequentially. From an on-year perspective, that would be 24-27 per cent higher because of the low-base effect.

Consequently, operating profitability, as represented by the Ebitda margin, would have narrowed by 40-80 bps on- quarter as a complete pass-through of the sharp increase in raw material cost would not have been possible.

Nearly half of the 40 sectors are expected to log a sequential drop in Ebitda margin amid rising input prices. While overall margins may have continued to improve on-year to 100-120 bps, excluding companies in the aluminium and steel products segments, it would have contracted 30-70 bps.

“The ability of companies to pass on the surge in commodity prices is limited, which caps the rise in margins. Crude oil prices are up 71 per cent in the second quarter on-year, and steel 47 per cent. Power and fuel expenses have risen because of 2x higher coal prices and over 4x higher spot gas prices. These would add to the woes, leading to margin contraction in the power and cement sectors,” adds Hetal Gandhi.

For the first half of this fiscal, overall Ebitda margin (for 300 companies) is estimated at 22-24 per cent, marking an expansion of 200-250 bps on-year, and driven by a 380 bps expansion in the first quarter.

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No user fee collection from two-wheelers at toll plazas: Govt

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7 days ago

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August 21, 2025

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New Delhi, Aug 21: The government on Thursday clarified that no user fee is levied from two-wheelers at the toll plazas on National Highways and National Expressways across the country.

The clarification came after reports surfaced that the National Highways Authority of India (NHAI) would collect user fees from two-wheeler riders at toll plazas.

“In reference to the fake news circulating on social media regarding toll collection from two wheelers on toll plaza, NHAI would like to clarify that no user fee is levied from two wheelers at the Toll plazas on National Highways and National Expressways across the country,” the Ministry of Road Transport and Highways said in a statement.

User fee on National Highways is collected as per the National Highway Fee (Determination of Rates and Collection) Rules, 2008, and there is no proposal to charge toll fee from the two wheelers, the ministry added.

According to the rules, the user fee at toll plazas is charged from four or more wheeled vehicles which include categories like car, jeep, van or light motor vehicle/light commercial vehicle, light goods vehicle or mini bus/bus or truck/heavy construction machinery (HCM) or earth moving equipment (EME) or multi axle vehicle (MAV) (three to six axles)/ oversized vehicles (seven or more axles.

Meanwhile, the NHAI sold over 5 lakh FASTag-based annual toll permits in just four days, collecting Rs 150 crore in revenue. Tamil Nadu recorded the highest number of purchases of annual passes in four days, followed by Karnataka and Haryana.

Further, Tamil Nadu, Karnataka, and Andhra Pradesh recorded the highest number of transactions through FASTag annual passes at toll plazas, a statement by NHAI said. Private vehicles can now use an annual toll pass for free passage through toll plazas on national highways and expressways, with each pass priced at Rs 3,000.

The annual pass is valid for one year from activation or for 200 toll trips, whichever occurs first.

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India To Clock 6.7% Growth Outpacing RBI Monetary Policy Committee’s 6.5% Recent Forecast

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1 week ago

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August 19, 2025

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New Delhi: India is expected to clock 6.7 per cent growth in the first quarter of the current fiscal (FY26), outpacing the RBI Monetary Policy Committee’s (MPC’s) recent forecast of 6.5 per cent, credit rating agency ICRA said on Tuesday.The rating agency report projects the growth in the gross value added (GVA) to stand at 6.4 per cent in Q1 FY2026.

Improved transmission of monetary easing and the recent announcement of forthcoming GST rationalisation may help to shore up urban consumption sentiments ahead of the festive season, the report said.”ICRA estimates a double-digit growth in net indirect taxes (in nominal terms), aided by the sharp uptick in the government of India’s indirect taxes (+11.3 per cent in Q1 FY26 from -3.1 per cent in Q4 FY2025), despite the narrower contraction in its subsidy outgo,” said Aditi Nayar, Chief Economist, Head-Research and Outreach, ICRA.

“Benefitting from robust government capital as well as revenue spending, upfronted exports to some geographies and nascent signals of improved consumption, the pace of expansion in economic activity in Q1 FY2026 is estimated at 6.7 per cent,” Aditi Nayar said.The rating agency estimates the YoY growth in the services GVA to increase to an eight-quarter high of 8.3 per cent in Q1 FY26, from 7.3 per cent in Q4 FY25, supporting the overall GVA expansion in that quarter.

In particular, the combined non-interest revenue expenditure of 24 state governments reported a double-digit YoY growth of 10.7 per cent in Q1 FY26, up from 7.2 per cent in Q4 FY25.Likewise, the Central government’s non-interest revenue expenditure saw a turnaround, recording a YoY growth of 6.9 per cent against a contraction of 6.1 per cent in the previous quarter, said the report.

Rural sentiments, as reflected in the Current Situation Index (CSI) improved further in the July 2025 (100.6) round of the RBI’s Rural Consumer Confidence Survey, reflecting favourable trends in farm output in the last two cropping seasons, and the upbeat outlook for the ongoing kharif season, and a considerable cooling in the rural CPI inflation.

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Indian Railways Introduces Discounted ‘Round Trip Package’ To Ease Festive Season Travel

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3 weeks ago

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August 9, 2025

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New Delhi: To avoid rush by ensuring hassle-free ticket booking experience during the upcoming peak festive seasons, the Ministry of Railways on Saturday said that it has decided to formulate a ‘Round Trip Package’ on discounted fare and rebates benefit.

The move will facilitate passengers and redistribute the peak traffic for a larger range during peak festival seasons and ensure both sides utilisation of trains, including special trains.

“It has been decided to formulate an experimental scheme named as Round Trip Package for festival rush on discounted fare,” the Railways Ministry stated.

According to the ministry, the scheme will be applicable for those passengers who choose their return journey during the prescribed period.

Under this scheme, rebates shall be applicable when booked for both the onward and return journey for the same set of passengers.

Passenger details of the return journey will be the same as those of the onward journey. Passengers can book their tickets from August 14 for the advance reservation period (ARP) date of October 13.

“An onward ticket shall be booked first for the train start date between 13th October 2025 and 26th October 2025, and subsequently return journey ticket shall be booked by using the connecting journey feature for the train start date between 17th November and 1st December 2025,” the Ministry stated.

However, advance reservation period will not be applicable for booking of return journey.

Other conditions to avail the benefits of the railway’s new special scheme are the booking shall be permissible only for confirmed tickets in both directions, total rebates of 20 per cent shall be granted on base fare of return journey only, booking under this scheme shall be for the same class and same O-D pair for both onward and return journey.

According to Railways, no refund of fare shall be permissible for the tickets booked under this scheme.

This scheme shall be allowed for all classes and in all trains, including special trains (Trains on demand), except trains having Flexi fare.

In addition, no modification will be allowed on these tickets in either of the journeys, and there will be no discounts, Rail travel coupons, Voucher-based bookings, or Passes be admissible during return journey booking on concessional fare.

Passenger can book their ticket via both online and offline modes; however, both onward and return journey tickets must be booked using the same mode (online or offline).

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