Also, infrastructure and resources needed for complex manufacturing, like roads, skilled labor and consistent power supply, is often lacking.This has boosted sales of heavy commercial vehicles and, by extension, auto ancillary companies.9 per cent, the fastest rate among the world's major economies.Nonetheless, the recovery in investment is patchy.4 per cent over the same period.Sales at smaller private firms grew 12 per cent in 2014/15, the central bank survey showed.His Bhagirath Coach & Metal Fabricators has just invested nearly 120,000 in new machinery and plans to spend up to 1. "Today our order book is more than our execution capacity," chief financial officer Naveen Sorot said. The annual study of nearly 240,000 unlisted small- and medium-sized enterprises (SMEs) found they are saving their way to growth, helping transform India into the world's fastest-growing large economy in the past two years. Now, Patel is buying new machines, hiring workers and spending more on marketing.

Capacity utilization at his Gujarat-based factory shot up to 80 per cent from 50 per cent in 2014/15.Flexibility is an advantage "Being a small-scale company has helped us in getting more orders," said Pramod Patel, managing partner at Reliable Paints. Most are unlisted, and their earnings growth has outpaced listed companies for the past three years.Operating profit of the unlisted firms grew an annual 16. In contrast, listed companies struggled with shrinking profits.That led to a contraction in capital spending in the January-March quarter.That's an encouraging sign for Asia's third-largest economy, where stressed balance sheets at big firms and heavy reliance on bank credit, which has dried up following a surge in troubled loans, have stymied efforts to revive private investment. Sales at listed big companies rose 1. Thermax Ltd an engineering company, reported a 15 per cent drop in its order book in the last quarter from a year ago.Encouragingly, the infrastructure push has begun to feed through to the balance sheets of some bigger listed firms.With banks increasingly taking action against corporations that default on loans, a senior government official said companies are likely to keep a lid on capital outlays unless they see visible returns on new investments. Its commercial vehicles wheel plant is now using 95 per cent of capacity from little over 35 per cent in 2013/14. (Representational Image) India has more than 45 million SMEs, accounting for nearly 40 pe rcent of gross domestic product. The company, which supplies wheel rims to major automakers, has seen a big leap in capacity utilization.Patchy RecoveryFor India to consistently grow at or above 8 percent that it targets to cast iron wheels Manufacturers generate jobs for a rapidly expanding workforce, major listed enterprises will have to come to the party.India has more than 45 million SMEs, accounting for nearly 40 per cent of gross domestic product. Steel Strips Wheels, for example, reported a 55 per cent jump in earnings per share in the fiscal year that ended in March.Sharma does not face such constraints.

He says his firm is debt-free and relies mainly on internal resources to fund capacity expansion. "So we are planning to expand our production capacity". Despite that, strong consumer spending helped power economic growth of 7. While higher expenses halved net profit growth at private firms, they still grew at double-digit pace. Patel's company, which supplies industrial paint to the metals, chemical, auto and defense sectors, saw 25 per cent growth in its order book in the fiscal year ending in March.Corporate earnings at listed non-financial firms in the March quarter grew 18 percent, the strongest in the past two years, raising hopes of an improvement in their debt-laden balance sheets.Helping power smaller firms has been Prime Minister Narendra Modi's plan to build 10,000 km of new national highways and upgrade another 50,000 km as part of 32 billion infrastructure spending this fiscal year.Debt-laden big listed firms, meanwhile, are still reluctant to undertake new investments, and foreign firms can find India's labyrinthine regulations overwhelming. Sales at his autoparts company in the western Indian state of Gujarat are booming and the order book has almost doubled in the past year. "We can customize different paint shades for clients, unlike big paint companies which can only provide specific paint shades," he said

Posted by: cllersaste at 03:21 AM | No Comments | Add Comment
Post contains 705 words, total size 5 kb.