It’s not surprising the Larsen & Toubro management observed it doesn’t expect any revival of capital expenditure in the private sector this year.

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 duet o one-off factors, has analysts worried.

The stress had set in even before the pandemic did, given the rise in consumption spends has been decelerating for close to two years now. At Maruti Suzuki, Ebitda crashed 32% due to higher-than-anticipated other expenses; net revenues fell by 15% y-o-y led by a 16% y-o-y drop in volumes. At TVS Motor, for instance, the Q4FY20 Ebitda fell a sharp 21% y-o-y despite reasonably good ASPs and measures to rein in costs.

At Dabur, volumes increased by just 4.6% y-o-y in the first two months of Q4FY20, despite the weak base and consolidated revenues declined 12% y-o-y. For Godrej Consumer Products (GCPL), FY20 was the third straight year of decelerating growth in revenues and operating profits, and analysts believe Q4FY20 would have been an indifferent quarter, even adjusted for the Covid-19 impact. The sluggish macro economic environment was already hurting businesses like those of Havell’s which reported a 1% y-o-y fall in revenues for M9FY20; the lockdown exacerbated the stress.