Power, coal, steel and IT sectors weighed on corporate performance while Ebitda margins contracted due to cost pressures in automobiles, pharmaceuticals and aluminium industries.
23 Oct 2025 | 1344 Views | By Angitha Suresh
Corporate India recorded a modest revenue growth of 5-6% year-on-year in the July-September 2025 quarter, according to an analysis by Crisil Intelligence released on Wednesday. The performance reflected weakness in key sectors including power, coal, information technology services and steel, which collectively represent approximately one-third of the revenue from over ...
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Corporate India recorded a modest revenue growth of 5-6% year-on-year in the July-September 2025 quarter, according to an analysis by Crisil Intelligence released on Wednesday. The performance reflected weakness in key sectors including power, coal, information technology services and steel, which collectively represent approximately one-third of the revenue from over 600 companies studied.
The research covered companies accounting for more than half of the National Stock Exchange's market capitalisation. While the growth rate showed a 100 basis points improvement from the previous quarter, earnings before interest, tax, depreciation and amortisation increased by only 1% on-year. Ebitda margins declined 50-100 basis points as companies faced difficulties passing on increased costs to customers.
The IT services sector experienced continuing challenges from geopolitical uncertainties, with project deferrals limiting revenue growth to 1%. The steel sector managed 4% revenue growth despite a 9% increase in volumes, as steel prices declined during the quarter. Hot-rolled coil prices fell 1% year-on-year, while primary thermo-mechanically treated steel prices dropped 6%.
The power sector recorded approximately 1% revenue growth, affected by increased hydroelectric generation from a monsoon season that reached 108% of the long-period average. A 10% rise in renewable energy generation further reduced demand for coal-based power, resulting in flat revenue growth for the coal sector.
Pushan Sharma, Director at Crisil Intelligence, noted that rationalisation of goods and services tax rates created market disruptions. The anticipation of new inventory at lower prices led to temporary setbacks in passenger vehicles and fast-moving consumer goods segments, as retailers and distributors delayed purchases. High inventory levels and sluggish retail sales further affected passenger vehicle demand in the quarter.
However, the rural economy benefited from favorable monsoon conditions. Government announcements of higher minimum support prices for kharif crops improved farmer sentiment, driving sales growth in tractors and two-wheelers. These segments contributed approximately 9% to overall auto sector growth. Tractor manufacturers reported a 36% revenue surge on a 31% volume increase, while two-wheeler revenue grew 9% on a 6% volume rise.
The cement, pharmaceuticals and telecom services sectors provided positive momentum. Cement revenue grew 8% following a 6-7% increase in volumes, supported by a low base effect and pre-festival demand. The pharmaceutical sector achieved 8% growth driven by export demand and stable domestic conditions. Telecom services revenue increased 7% due to higher realisations from costlier subscription plans, despite flat subscriber growth.
Elizabeth Master, Associate Director at Crisil Intelligence, highlighted margin pressures in the top seven sectors, which collectively account for more than half of India Inc's revenue.
The automobile sector faced margin contractions of 150-200 basis points due to an 11% year-on-year increase in aluminium prices during the quarter. The aluminium sector itself saw margins decline 100-150 basis points because of lower export realisations and pressure from falling global alumina prices.
Pharmaceutical margins contracted 150-200 basis points owing to pricing pressure on existing products facing higher competition in export markets compared with newly launched products.
In contrast, three of the top ten sectors recorded margin expansions. The cement sector's margin rose 500-550 basis points, supported by revenue growth and stable costs. Steel sector margins expanded 150-200 basis points due to a 13% year-on-year decline in coking coal costs.
The telecom services sector saw margins increase 180-230 basis points from lower operating expenses, attributed to improved network efficiency following battery infrastructure upgrades.