The RBI private corporate business sector recorded stronger sales growth in the first quarter of 2026-27, with listed private non-financial companies reporting a 19.4% year-on-year increase. The Reserve Bank of India released the data on August 27, 2026, based on abridged quarterly financial results of 3,247 listed non-government non-financial companies.
Manufacturing leads the acceleration
Manufacturing companies recorded sales growth of 21.4% in Q1 2026-27, up from 14.5% in the previous quarter. According to the RBI, the acceleration was mainly driven by the automobiles, petroleum and electrical machinery industries.
The IT sector also recorded stronger growth. Sales of IT companies increased 14.8% year-on-year, compared with 9.9% in the previous quarter. Non-IT services maintained double-digit growth at 19.7%, slightly below the 20.3% recorded in the preceding quarter, with wholesale and retail trade providing the main support.
Higher business activity was accompanied by increased input expenses. Raw material costs for manufacturing companies rose 27.5% year-on-year during Q1, although the raw material-to-sales ratio improved marginally to 58.1% from 58.5% in the previous quarter.
Staff costs increased 12.4% for manufacturing companies, 7.6% for IT companies and 11.2% for non-IT services companies. The staff cost-to-sales ratio increased to 5.5% for manufacturing and 10.1% for non-IT services, while it declined for IT companies.
Operating profits and interest coverage improve
Despite the rise in input costs, manufacturing companies reported operating profit growth of 21.3% in Q1 2026-27, compared with 9.4% in the previous quarter. Operating profit growth was 19.9% for IT companies and 12.7% for non-IT services companies.
Operating profit margins improved sequentially across all major sectors. Margins stood at 14.7% for manufacturing, 22.7% for IT and 20.9% for non-IT services. The aggregate operating profit margin was 16.4%.
The RBI also reported an improvement in interest coverage for manufacturing companies. The ratio increased to 10.2 in Q1 as gross profits rose faster than interest expenses. The interest coverage ratio for non-IT services companies increased to 2.6, while IT companies continued to record an elevated level.
