Brokerages predict bright growth for Sensex firms | business | Hindustan Times
Today in New Delhi, India
Jan 24, 2017-Tuesday
New Delhi
  • Humidity
  • Wind

Brokerages predict bright growth for Sensex firms

business Updated: Jul 11, 2010 21:50 IST
Sandeep Singh
Sandeep Singh
Hindustan Times
Highlight Story

Amidst rising demand and economic activity, brokerages project India Inc to grow its revenues at a healthy rate of over 20 per cent. However, there are concerns on the profit growth as some brokers do not see a good prospect due to a high input cost.

Brokerages expect revenue growth to be driven by automobile, capital goods, construction, metal and pharma sectors while they predict a bad performance by the telecom and the cement sectors.

“The growth in the earnings of the Sensex companies would be achieved mainly on the back of a relatively better performance of the metal and capital goods sector. Telecom and cement sectors are likely to act as a drag on the Sensex earnings,” said a report by Sharekhan that projected a revenue growth of 22.5 per cent for the Sensex companies and a profit growth of 28.6 per cent.

Edelweiss expects profits for Sensex companies to grow by 6 per cent. The brokerage sees a contraction in operating margins by 367 basis points (100 basis point is one percentage point) on a year-on-year basis.

“This contraction in margins is expected to be led by companies in the telecom and cement sectors,” said the Edelweiss research report.

While year-on-year growth is likely to remain strong, brokerages see a weak quarter-on-quarter performance.