<< CEO and CFO for Satyam to ... << Sales grew at pretty attractive rate in Q3 but profits dipped

Anurag Bhullar


As per ETIG analysis, done on 60 companies, excluding banks and financial service firms, sales increased at 33% in the third quarter of 2008, which is more than twice the value last year for the same quarter. The net profits however decreased from 25% in third quarter of 2007 to 22% in the corresponding period in 2008. The rate stood at more than 30% for the quarter ended Sep’08.


Operating profit growth rate too, came down by from 26% (in previous quarter) to 24% (in third quarter of 2008). Among the considered companies was Infosys Technologies Inc., which posted a jump of 33.3% in net profits and 35.5% rise in revenues. Though size of the sample considered is small and cannot be used to infer about the whole corporate bunch but the trend of increased sales and lowered profits is in accordance with the observations. In the previous two quarters also, values of sales and profits have shown a similar movements.


The bottomlines have been a tough nut to crack as the procurement costs of raw materials soared 53%, while it was 35% in the third quarter in previous year. This is despite the downward movement in crude oil and commodity costs. Further contributors to risen input costs include 31% hike in interest costs and increase in depreciation by 20%.

 
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