Q1FY20 Earnings : A Mixed Bag!

Earings this season has been a mixed bag. Shohini Nath travels through various companies and indices to understand the underlying trend in earnings while DSIJ research team analyse the sectoral performance giving investors an insight into corporate India's performance in Q1FY20.

- Shohini Nath

Time has come yet again to evaluate quarterly earnings. It is the beginning of the FY2020 and the end of the first quarter amid the ongoing economic slowdown. Let us rewind to November 2016 when the demonetization happened, dealing a severe blow to consumption, which resulted in declining incomes and loss of jobs, which led to an even bigger drop on the demand side. Post-demonetisation, the GST reform came into play in July 2017, and just like every reform, the GST reform took some time to settle. However, just as the effects of demonetization and GST were dwindling, enter the IL&FS crisis that triggered the NBFC credit crunch in 2018. The end of 2018 welcomed the US-China trade war, thereby affecting the global trade and GDP growth. In the much-anticipated budget session, the fiscal stimulus was not announced which disappointed the market participants creating confusion in the minds of investors. The economy and the markets both run in a cyclical phase and take time to absorb the changes that occur, but the silver lining is that they always bounce back. Now, here we are, post the Q1FY20 earnings season that reflected mixed results, with the banks expressing relief on the financial front, while most other sectors were hit by low consumer demand.