After benefiting from lower raw material costs in October-December, India Inc. faces commodity headwinds in the ongoing quarter.
Aggregate revenue of Nifty 50 companies rose 1.1% year-on-year in the three months ended December as companies recovered from the Covid-19 lockdown, according to BloombergQuint calculations. Net profit growth surged 22.7% on lower expenses on inputs and wages.
But commodity prices are rising. The Bloomberg Commodity Index tracking oil, natural gas, copper, zinc, and other commodities surged over 9% between Jan. 1 and March 15. European Brent crude has risen 35% so far this year. Petrol and diesel prices in India are at record highs. The impact will be worst on sectors that fail to pass on higher costs to consumers.
Still, there are BSE 500 companies that are expected to defy higher costs to see growth in their top as well as the bottom line. Based on estimates tracked by Bloomberg, here are the BSE companies that are expected to see the highest earnings growth along with at least a double-digit increase in revenue.
Adani Ports and Special Economic Zone Ltd. and Godrej Consumer Products Ltd. lead the list.
Selection criteria:
- BSE500 companies.
- Tracked by at least four analysts.
- Revenue estimated to rise by at least double digits—to exclude firms where the bottom line will be aided by reasons other than core business.
- Best growth in adjusted earnings per share.