Revenues of India Inc likely to grow at a two-year high in Q1 despite West Asia tensions: Crisil Intelligence

Domestic rating agency Crisil’s arm, Crisil Intelligence has projected that revenues of India Inc are likely to grow at a two-year high of up to 11.5% in the June quarter (Q1) of fiscal year 2026-27 (FY27), despite ongoing tensions in West Asia, which have had far-reaching implications, including supply chain disruptions and rising domestic inflation. Based on an analysis of 400 companies across 47 sectors, excluding banking, financial services, and oil & gas, the agency said corporate India is expected to deliver robust revenue growth as domestic demand has remained “reasonably well” despite developments in West Asia since late February.

According to the report, the automobile sector is likely to be among the strongest contributors to overall growth. It noted that automobiles, white goods, telecom services, power generation, and segments of the healthcare sector continued to benefit from healthy domestic demand.

The automobile and white goods sectors gained from the rationalisation of Goods and Services Tax (GST) rates, while power generation was supported by rising peak demand and telecom services by premiumisation and data monetisation. Revenue in the automobile sector alone is estimated to have grown by as much as 24%, driven by GST-led demand momentum, strong passenger vehicle and two-wheeler sales, healthy commercial vehicle demand, export growth, and selective price hikes.

The report further stated that the power generation remained largely insulated from external disruptions and is likely to have recorded revenue growth of 8-10%, supported by an estimated 8% increase in peak power demand.

Meanwhile, the telecom sector is projected to grow by 10-11%, aided by premiumisation, data monetisation, migration to postpaid plans, and subscriber upgrades. In sectors such as metals, cement, chemicals, tyres, fertilisers, gems and jewellery, and parts of the consumer segment, improved realisations contributed significantly to revenue growth.

Moreover, aluminium producers benefited from supply disruptions and firmer global prices, while steel and cement companies gained from better pricing realisations. The report also noted that the IT sector is likely to post revenue growth of around 5%, supported by favourable currency movements, even as enterprises remain cautious in their spending decisions. However, profitability is likely to remain subdued during the quarter, with operating profit margins likely to contract by up to one percentage point.