Third quarter earnings point to moderate recovery
Results declared by major companies, so far, show some signs of a moderate economic recovery. Some improvement is also because of the base effect as the same period last year witnessed demonetisation.
A key challenge is rise in input prices, though consumer demand is on an uptick.
Despite some instances of disappointment, the October-December earning season has mostly been on track so far. Results declared by major companies, so far, show some signs of a moderate economic recovery. Some improvement is also because of the base effect as the same period last year witnessed demonetisation. A key challenge is rise in input prices, though consumer demand is on an uptick.
The management commentary from Larsen & Toubro, which beat estimates on almost all fronts, was most encouraging. The company said the quarter was a satisfactory one and fresh orders won by it were up 38 per cent, which was a relief from the previous two quarters where the outcome was not proportionate to the effort put in by the firm to win the orders. However, the company has not revised its guidance for the year. L&T posted a decent 11 per cent year-on-year (y-o-y) growth in its infrastructure revenues, with domestic infrastructure growth scaling a six-quarter high of 20 per cent. Private capex continues to be sluggish and order inflow continues to be mostly from PSU firms.
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