Costs down, but industry sales, profits 'much less than normal': IIM-A survey

Sales levels % response

By A Representative
The latest Business Inflation Expectations Survey (BIES) of the Indian Institute of Management-Ahmedabad (IIM-A) which is based on detailed feedback received from the industry, academicians and policy makers, and responses from over 1,600 companies, has said that around 49% of the firms in July 2019 reported increase in costs has been more than 3%, down from 55% reported in June 2019, during the last one year.
Furthermore, the BIES survey said, the proportion of firms perceiving significant cost increase (more than 6%) in July 2019 has also "declined slightly to around 29% from 31% reported in June 2019", it added.
At the same time, in July 2019, the survey said, almost three-fourths of the firms (highest ever since the inception of the survey in May 2017) in the sample reported that sales are ‘somewhat or much less than normal’, insisting, "This proportion has increased significantly from June 2019."

Profit margins % response

The survey also reveals that "the proportion of firms in the sample reporting ‘much less than normal’ profit margins has increased further to 54% in July 2019. It may be mentioned that this proportion had crossed 50% mark for the first time in June 2019."
It adds, "On the other hand, the proportion of firms in the sample reporting ‘normal or greater than normal’ profit margins has declined further to 20% in July 2019 from 24% in June 2019. Overall, the profit margin scenario has further deteriorated in July 2019."

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