Around 4000 Indian companies report strong EBITDA growth in Q3FY25: SBI Report
Feb 20, 2025
New Delhi [India], February 20 : Indian companies showed a strong recovery in the October-December quarter (Q3FY25) after two consecutive quarters of negative EBITDA growth, says a report by the State Bank of India (SBI).
The report highlights a positive trend in earnings before interest, tax, depreciation, and amortization (EBITDA), with an improvement in margins across industries.
It said "Around 4000 Corporate in listed space reported revenue growth of 6.2 per cent while EBIDTA and profit after tax (PAT) grew by around 11 per cent and 12 per cent respectively in Q3FY25 as compared to Q3FY24"
Around 4,000 listed companies reported a revenue growth of 6.2 per cent in Q3FY25 compared to the same quarter last year. More importantly, EBITDA and profit after tax (PAT) grew by approximately 11 per cent and 12 per cent, respectively, indicating stronger operational performance.
For companies excluding the banking, financial services, and insurance (BFSI) sector, revenue grew by 5 per cent, while PAT increased by 9 per cent. This indicates a broad-based recovery across various industries, even outside the financial sector.
One of the most significant takeaways from the report is the turnaround in EBITDA growth. The same set of companies that had reported negative EBITDA growth in the past two quarters posted a 5 per cent increase in Q3FY25.
At an aggregate level, EBITDA margin improved by 44 basis points (bps), rising to 14.84 per cent in Q3FY25 from 14.4 per cent in the previous quarter. Corporate gross value added (GVA), a key indicator of economic productivity, also saw a notable improvement, increasing by 300 bps year-on-year to 9.55 per cent.
The report attributed this recovery in corporate earnings to improving consumer sentiment. A slowdown in household inflation expectations has encouraged higher discretionary spending, driving demand-led growth across industries.
Additionally, declining consumer confidence, which had been a concern in previous quarters, is now stabilizing. Households are becoming more optimistic about global economic trends, the disinflation process, and long-term growth prospects.
This shift in sentiment is expected to support sustainable economic expansion, with businesses benefiting from improved demand conditions.
The positive earnings trend in Q3FY25 suggested that Indian companies are well-positioned for continued growth in the coming quarters.
