Losses weigh on India Inc Q3 results
India Inc’s aggregate performance in Q3FY22 has been disappointing with revenues growing at just 16.7% year-on-year, the slowest pace in the last four quarters. Moreover, net profits for a sample of 1,685 companies (excluding banks and financials) have fallen by 12% y-o-y thanks to a contraction in operating profit margins of 243 basis points y-o-y and a 24% y-o-y jump in interest costs. Also, more companies have reported losses or a year-on-year drop in profits for the quarter than in December 2021.
Except for banks, IT services and automobiles, corporate earnings growth could remain subdued in FY24 as the economy is poised to decelerate sharply. With a few days to go before the end of earnings season, analysts at Jefferies noted that of the 100 companies they analysed for Q3FY23, 40% had reported numbers that were below estimates. Much like in FY23, earnings growth is expected to be dominated by banks and financials in the coming year too
Goldman expects $2.3 bln more in potential losses from legal disputes
Goldman Sachs Group Inc is expecting potential losses from legal proceedings to be up to $2.3 billion more than the reserves it had set aside for such matters as of last year, the investment bank said on Friday.
In 2021, the bank was expecting the likely losses to be $2 billion higher than the reserves.
Goldman has been targeted with lawsuits ranging from the bank’s role in Malaysia’s 1MDB sovereign wealth fund scandal to the collapse of Archegos Capital Management in 2021.
A long-running gender bias lawsuit alleging widespread bias against women in pay and promotions at the Wall Street bank is also expected to head to trial later this year.