While the damage to revenues and profits was limited in the March quarter, India Inc is bracing for a tough 2020-21.
The commentary continues to be very cautious, even bordering on the pessimistic, given how the lockdown has crimped cash flows in the June quarter so far. Given how poor visibility on demand is, few firms are able to see where revenues are headed and analysts are trimming earnings estimates across the board.
It’s not surprising the Larsen & Toubro management observed it doesn’t expect any revival of capital expenditure in the private sector this year.
The company said the sales missed so far because of the disruption from Covid-19 were around Rs 15,000-17,000 crore.
At InterGlobe Aviation, the capacity utilisation is just about a fifth of that available and occupancies are expected to climb slowly since international travel is some time away; despite gains from lower fuel prices and lower expenses on employees, the airline is expected to report a loss of close to Rs 7,000 crore in FY21.
The crash in prices of commodities has hit producers as seen in the staggering Rs 15,269-crore loss before tax reported by Vedanta for Q4FY20, triggered by an exceptional loss of Rs 17,132 crore on account of impaired assets, primarily a steep fall in crude oil prices.
At BPCL, inventory losses were high and the sharp rise in debt, albeit partly due to one-off factors, has analysts worried.