India’s listed private non-financial companies maintained strong growth momentum in the fourth quarter of FY26, with aggregate sales rising 13.9% year-on-year (YoY), according to the latest data released by the Reserve Bank of India (RBI).
The quarterly review, based on abridged financial results of 3,266 listed non-government non-financial companies, highlighted stronger revenue growth across manufacturing, information technology (IT) and non-IT services sectors, even as businesses grappled with rising raw material costs amid global uncertainties.
Manufacturing drives growth
The manufacturing sector emerged as a key growth engine during the quarter. Sales of 1,817 listed manufacturing companies expanded 14.5% YoY in Q4 FY26, up from 11.4% in the previous quarter.
The acceleration was largely driven by automobiles, electrical machinery and non-ferrous metals industries, reflecting sustained demand across industrial and consumer segments.
Services sector gains momentum
The IT sector continued its gradual recovery, with sales growth improving to 9.9% YoY during the quarter from 8.8% in Q3 FY26.
Non-IT services companies posted an even stronger performance, recording sales growth of 20.3% YoY. The sharp increase was mainly driven by higher sales growth in the wholesale and retail trade segment.
Supported by broad-based strength across manufacturing and services, listed private non-financial companies improved aggregate sales growth to 13.9% in Q4 FY26 from 10.1% in the previous quarter.
Rising costs squeeze margins
Despite healthy revenue growth, companies faced mounting input cost pressures during the quarter.
Raw material expenses of manufacturing companies surged 18.3% YoY, reflecting the impact of global uncertainties and higher commodity prices. The raw material-to-sales ratio rose to 58.5% in Q4 FY26 from 57.5% in the previous quarter, indicating increased pressure on operating costs.
Staff cost growth for manufacturing companies moderated to 9.8% YoY during the quarter. Within the services sector, staff costs for non-IT companies grew at a faster pace of 8.9%, while employee expenses for IT companies remained broadly stable compared with the previous quarter.
Staff cost-to-sales ratios declined for manufacturing and non-IT services companies to 5.3% and 9.4%, respectively. However, the ratio edged up marginally for IT companies.
Profit growth remains resilient
Higher input costs weighed on manufacturing sector profitability, with operating profit growth moderating to 9.4% YoY in Q4 FY26 from 11.8% in the previous quarter.
However, services companies reported stronger earnings momentum. Operating profit growth improved to 14.1% for IT companies and 6.5% for non-IT services firms during the quarter.
On a sequential basis, operating profit margins of manufacturing companies remained stable, while services sector companies witnessed some moderation in margins.
Balance sheets stay healthy
Corporate balance sheets remained resilient despite cost pressures. Manufacturing companies reported an improvement in their interest coverage ratio (ICR), which rose to 9.5 in Q4 FY26 from 9.0 in the previous quarter, supported by stronger growth in gross profits relative to interest expenses.
Within the services sector, the ICR of non-IT services companies remained unchanged at 2.3, while IT companies continued to maintain a significantly elevated interest coverage position, highlighting their strong financial health.
Outlook
The RBI data suggests that India’s listed private corporate sector ended FY26 on a strong note, supported by robust sales growth across manufacturing and services. While rising input costs continue to pose challenges, stable profitability and healthy debt-servicing capacity indicate that corporate India remains resilient amid a volatile global economic environment.