After witnessing the worst quarter in six years, corporate India is likely to see the earnings slowdown to continue in the next fiscal, along with falling demand putting pressure on the sales growth, global financial major Citigroup says.
"Currently, we are clearly not as optimistic, (We) forecast negative one per cent earnings growth in FY10," Citigroup's research arm analysts said in a strategy report.
India Inc suffered a decline in earning growth for the first time in six years, with Sensex companies' earnings growth (excluding oil firms) declining 4.5 per cent and BSE-500 index firms suffering a slump of 16 per cent in the third quarter this fiscal.
The report stated that the December quarter of FY '09 has been "decisively worse" than the quarter ended September, 2008, in terms of sales, earnings before interest, taxes, depreciation and amortisation (EBITDA) and profits.
The Sensex firms' earnings have dropped sharply from 12 per cent growth in second quarter this fiscal to a negative 4.5 per cent in the December quarter -- one of the highest falls in the recent past.