What Is India’s Corporate Profitability And What Are Its Determinants? Motilal Oswal Explains

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Motilal Oswal Report

When anyone talks about India’s corporate profitability, we tend to narrow down our analysis to the listed sector comprising of about 6,500 companies.

Corporate profitability in India, in this narrow sense, peaked out at 6.3% of gross domestic product in FY08 and has fallen to a 27-year low of 1.5% of GDP in FY20.

During the same period, corporate profitability in the U.S. moved to 9% from 8% of GDP.

The same for the UK rose slightly to 9.1% from 8.6% of GDP.

In short, while corporate profitability in India fell in the 2010s decade, it rose to a record high in the U.S. and was stable in the UK.

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