Indian corporate revenue is estimated to have grown between 8.5 and 9 percent year on year during the fourth quarter of fiscal 2026, says a report by Crisil Intelligence. The growth was primarily supported by sustained volume momentum in the automobile and white goods sectors, following a rationalisation of GST rates in September 2025.

Despite the revenue growth, operating margins for an analysed set of over 400 companies contracted by 25 to 50 basis points during the quarter. Aggregate revenue growth is expected to moderate to between 8 and 8.5 percent in the first quarter of fiscal 2027. Margins are projected to decline further by 75 to 100 basis points to a 12 quarter low during this upcoming period. This downward pressure is largely attributed to supply chain disruptions, delivered cost inflation, and price hikes stemming from the ongoing conflict in West Asia.

The regional disruptions present significant risks to India's energy and trade balances. India imports approximately 89 percent of its crude oil, with 46 percent routed through the Strait of Hormuz. The country also relies on imports for 50 percent of its liquefied natural gas, of which 56 percent passes through the same strait. Furthermore, West Asia accounts for 13 percent of India's goods exports and 38 percent of its remittance inflows.

Sectors directly exposed to the supply disruptions, such as airlines, chemicals, petrochemicals, and pharmaceuticals, faced substantial profitability challenges in the fourth quarter, with margins declining by more than 200 basis points year on year. Exports of textiles and engineering goods have also been impacted by a two to three times increase in freight costs on the India to West Asia route. Conversely, construction linked sectors, including steel, cement, and aluminium, likely experienced margin expansion during the quarter.