The June-quarter earnings announced so far paint a clear picture of the exact damage that COVID-19 has done to the balance sheets of companies. The impacted firms include even the big players from the worst-hit sectors such as automobiles, realty, aviation, travel and hospitality among others.
Some of the giants that witnessed exceptional losses during these unprecedented times include Maruti Suzuki, TVS Motor Company, InterGlobe Aviation, ITC, India Cements, UltraTech Cement among others as their businesses came to a near standstill.
Giants hitting a low
Maruti Suzuki, India's largest passenger-car manufacturer, reported its first quarterly loss since 2001. The net loss stood at Rs 249.4 crore in the first quarter. The revenue came in at Rs 4,106.5 crore, declining 79.2 percent from the Rs 19,719.8 crore reported in the same quarter last year.
It is be noted that the net loss was partially offset by lower operating expenses and a tax write-back of Rs 96.3 crore, else the number would be higher. The company couldn’t sell even a single vehicle in April owing to the lockdown.
TVS Motor Company, the third-largest motorcycle company in India, reported a standalone net loss of Rs 139.1 crore for the first quarter as the pandemic severely impacted its sales. The company had posted a net profit of Rs 142 crore in the same quarter last year. The revenue witnessed a significant fall, from Rs 4,469.8 crore to Rs 1,434.3 crore, YoY.
From the aviation space, InterGlobe Aviation, the parent company of IndiGo, that leads in terms of market share in the country, reported its steepest loss in at least 5 years. The company reported a net loss of a whopping Rs 2,844.3 crore for Q1. The airline's total income declined 88 percent to Rs 1,143.8 crore, YoY.
Recently, the airline had announced the second round of pay cuts, increasing the percentage of deduction applicable on the salaries of its senior staff including CEO Ronojoy Dutta. This move came days after the airline announced that it laid off 10 percent of its workforce.
India Cements, one of India's leading cement manufacturers, reported a 69 percent fall in its consolidated net profit YoY to Rs 19.47 crore as real estate activities remained halted for the quarter. Its revenue from operations was down 48.97 percent to Rs 763.46 crore, YoY. The company said its regular business operations were disrupted severely due to the lockdowns.
UltraTech Cement, a subsidiary of Aditya Birla Group, posted a decline of nearly 38 percent in the net profit at Rs 796 crore for the quarter while its revenue fell by more than 33 percent to Rs 7,633 crore, YoY.
Multinational firm ITC, which also runs one of India’s largest hotel chains, reported a 25 percent decline in consolidated profit at Rs 2,567.07 crore for the June quarter. The revenue from operations stood at Rs 10,478.46 crore, down 17 percent, YoY. Despite the business taking hit by a significant number, it appeared better than the leaders in other sectors.
Crisis a boon for some
While businesses, in general, suffered exceptional losses across the world during the June quarter, there were some that managed to capitalise on the crisis. In fact, ecommerce giant Amazon even recovered from its long-standing pain point.
Amazon reported a profit of $345 million in its international business, its first such quarterly profit internationally in many years. The profit was led by an increase in sales amid the coronavirus crisis as the lockdown kept people away from physical stores. The company’s international business includes markets like India, Europe and Japan.
The profit in international business stands as a highlight for the company as it has seen losses as high as $900 million in some quarters in the global operations. Over the recent quarters, the company’s international business witnessed losses in the range of $400 million to $600 million.
Besides, Jio, India’s largest telecom company, clocked a 182 percent YoY growth in its net profit to Rs 2,520 crore as users staying at home and the ‘work from home’ model led to a rise in data consumption.
The company’s average revenue per user (ARPU) stood at Rs 140, way ahead of analyst estimates. The company added 9.9 million customers during the quarter despite the COVID-19 lockdown. Users on its platforms consumed 1,420 crore GBs of wireless data, a rise of 30.2 percent YoY.