Moderation in Net Sales Growth for FDI Companies in India: RBI Report
Net sales growth of FDI companies moderated to 8.7% in FY25: RBI data
The Economic TimesImage: The Economic Times
The Reserve Bank of India (RBI) reported a slowdown in net sales growth for foreign direct investment (FDI) companies in India, dropping to 8.7% in the fiscal year 2024-25 from 9.4% the previous year. The services sector saw a slight increase, while manufacturing experienced a decline in growth rates.
- 01Net sales growth for FDI companies fell to 8.7% in FY25.
- 02Services sector growth slightly increased to 12.7%, while manufacturing dropped to 5.1%.
- 03Operating profit growth slowed to 10.7% from 22.1% in the previous year.
- 04Profit after tax rose by 22.2%, driven by higher non-operating income.
- 05Services sector companies outperformed manufacturing in post-tax profit growth.
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According to the Reserve Bank of India (RBI), net sales growth for foreign direct investment (FDI) companies in India moderated to 8.7% in the fiscal year 2024-25, down from 9.4% in the previous year. This data was derived from the financial performance of 3,100 non-government non-financial (NGNF) FDI companies, which reported their accounts in accordance with Indian Accounting Standards (Ind-AS). The services sector experienced a slight increase in growth, rising to 12.7%, while the manufacturing sector faced a decline, with growth dropping to 5.1%. Operating profit growth also slowed significantly to 10.7% compared to 22.1% in the previous year. However, profit after tax saw a notable increase of 22.2%, attributed to higher non-operating income and reduced interest expenses. The services sector led in post-tax profit growth, achieving 29.2%, compared to 12.6% for the manufacturing sector.
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The moderation in sales growth and operating profits could affect investment decisions and economic outlook for sectors reliant on FDI.
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