Rising input cost hitting manufacturing firms

Mumbai: Sales of 1,647 listed private manufacturing companies recorded 'extraordinarily high' growth of 75 per cent in the first quarter of FY22 mainly due to a very low base in the pandemic-hit year-ago period, showed RBI data released on Monday."Operating profits of manufacturing, as well as services sector companies (both IT and non-IT), recorded high growth in Q1:2021-22 in line with the rise in sales," the central bank said.

It further said that manufacturing companies increased their expenditure on raw materials during the first quarter of the fiscal in tandem with the rise in sales. Also, staff cost growth accelerated for all sectors. Also, the operating profit margin remained stable for manufacturing and IT companies during the quarter, but it moderated for the non-IT services companies.

Their sales had declined by 41.1 per cent in the April-June quarter of FY2020-21. In absolute terms, the sales of the manufacturing companies worked out at Rs 7,02,791 crore as against Rs 3,97,233 crore in the first quarter of FY2020-21.