Reserve Bank of India’s (RBI) recent data showed that the sales of listed manufacturing sector companies grew by 6% during 2024-25 as compared to 3.5% growth in the preceding year, led by automobiles, electrical machinery, food and beverages, and pharmaceuticals industries. Meanwhile, among the major industries, petroleum and iron & steel sectors experienced a contraction in their sales during 2024-25. During the same period, the listed private non-financial companies’ sales growth improved to 7.2% from a low of 4.7% during the previous year. 

Besides, RBI has indicated that the growth of IT companies improved to 7.1% during 2024-25, from 5.5% in the previous year, despite of global headwinds. Further, a double-digit sales growth has seen in non-IT services companies, boosted by healthy performance of telecommunication, transport and storage services, and wholesale and retail trade industries.  During the same period, in line with acceleration in sales, manufacturing companies' expenses on raw material rose by 6.6%, meanwhile, their raw material to sales ratio increased to 55.7% from 54.2% a year ago, suggesting an input cost pressure. Moreover, staff cost of manufacturing, IT and non-IT services companies grew by 10%, 4.4% and 12%, respectively. The staff cost to sales ratio broadly remained stable for manufacturing companies while it moderated for services companies.

The data also indicated that increase in the input costs led to a moderation in growth of operating profit of manufacturing companies to 6% during 2024-25 from 12.4% in the previous year. In the service sector, profit growth for the non-IT services companies moderated to 15.9%, while it inched up to 6.1% for IT companies. During the same period, operating profit margin for manufacturing, IT and non-IT services companies moderated by 20 basis points (bps), 80 bps and 30 bps to 14.2%, 21.9% and 22.1%, respectively.