India Inc is poised to report 11-11.5% revenue growth for the April-June quarter (Q1 FY27), according to ratings agency Crisil, as pricing power—not volume—drives the top line amid supply disruptions and higher input costs from the West Asia conflict. The quarterly earnings season, already underway, gathers pace with Reliance Industries, HDFC Bank, ICICI Bank, and Kotak Mahindra Bank scheduled to report this week.
Revenue Growth Driven by Pricing
“Pricing, rather than volume, is behind much of the growth this quarter – a reversal from the past two years,” said Sehul Bhatt, director-research at Crisil. Resilient domestic demand allowed companies to pass on cost burdens to consumers, cushioning the impact of supply-chain disruptions. The reversal marks a strategic shift as firms lean on price increases to sustain revenue amid volatile input costs.
Sectoral Performance: Winners and Losers
A broad swath of sectors drew support from domestic demand. Automobiles, white goods, telecom services, power generation, steel, and healthcare benefited from resilient spending. Intense summer heat drove demand for air conditioners, while power companies saw peak seasonal demand. Telecom firms gained from premiumisation and data monetisation. Steel was bolstered by stronger prices, and cement firms cushioned cost increases through price hikes. Building-materials major Nuvoco Vistas Corp posted a 7% rise in operating profit to Rs 572 crore—its highest-ever first-quarter operating profit—with MD Jayakumar Krishnaswamy crediting cost discipline and operational efficiencies.
| Sector | Revenue Growth Estimate | Key Driver |
|---|---|---|
| Overall India Inc | 11-11.5% | Pricing power |
| FMCG | 6-7% | Price increases; cost pressures on profitability |
| Pharmaceuticals | ~12% | Domestic demand, new launches, semi-regulated exports |
| IT Services | ~5% | Favourable currency moves; cautious enterprise spending |
| Construction | 1-3% | Geopolitical disruptions delaying project execution |
| Textiles & Processed Food | Disrupted | Higher freight rates, longer shipping schedules |
In the FMCG space, revenue is estimated to grow 6-7% on price increases, though higher packaging, logistics, and food-related costs weighed on profitability. Axis Securities expects Nestle India, CCL Products, and Varun Beverages to outperform peers. Abhijit Roy, MD of Berger Paints, said: "We will have double digit value growth in Q1" and added that the second and third quarters would be even stronger, improving on a weak year-ago period affected by excessive rainfall and an early Diwali.
Construction was a laggard, with sector revenue estimated to grow just 1-3% as geopolitical disruptions slowed project execution and delayed revenue recognition despite healthy order books. L&T will declare its Q1 numbers on July 28.
Exporters bore the brunt. Textiles, pharmaceuticals, and processed food faced disruption from higher freight rates and longer shipping schedules. However, pharmaceuticals held up better, with revenue estimated to grow 12% on domestic demand, new launches, and exports to semi-regulated markets, even as input/logistics costs and US pricing pressure weighed on margins.
IT services revenue is estimated to grow 5%, driven largely by favourable currency movements as enterprises stayed cautious on spending. TCS reported a profit rise of about 5% to Rs 13,349 crore, while Wipro was flat at Rs 3,356 crore. Infosys will declare earnings on July 23. Meanwhile, Tata Motors’ passenger vehicles may report weaker results on continued challenges at Jaguar Land Rover, and Hyundai could see some moderation.
Margin Pressure Across Sectors
Corporate operating profit margin is estimated to contract 75-100 basis points on-year, as companies absorbed part of the cost rise rather than passing it all on, according to Crisil. The worst hit was the airline sector: aviation turbine fuel costs rose even as passenger traffic softened, driving an estimated 1,000 basis point decline in operating profit margin. By contrast, non-banking financial companies (NBFCs) enter the results season on firmer footing, with better margins and asset quality after facing retail lending stress.
Outlook and Key Factors
Crisil flagged three factors that will shape corporate earnings trajectory ahead: the balancing of further price hikes with demand; recovering costs without losing volumes; and seeing relief in fuel, freight, and raw material prices. Investors will closely watch management commentary on pricing strategy and cost pass-through in the coming weeks. The next major earnings releases include Infosys on July 23 and L&T on July 28.
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