Profitability is the primary goal of a company. Not only does it provide gains for its shareholders, but also ensures that the company survives in the long run.
It is critical to measure a company’s current profit, as well as future profit, to evaluate a company, whether is worthy of investment.
In the financial year ended March 2022, India Inc reported an average 50% growth in consolidated net profit and around 25% rise in revenue on a year-on-year basis.
Here is the list of the top 10 most profitable companies in India.
|Sr. No||Company||FY22 Net Profit
|FY22 Net Profit Growth (YoY)||FY22 Revenue
|6||State Bank of India||35,374||58.00%||4,06,973|
|8||Indian Oil Corporation||25,102||16.01%||7,36,730|
Source: Companies’ financial results as of year ended March 31, 2022
Reliance Industries Ltd (RIL)
The billionaire Mukesh Ambani-led oil-to-telecom conglomerate Reliance Industries is the top most profitable company in FY2022. The company reported a consolidated net profit of Rs 60,705 crore in FY22, registering a sharp growth of 23.5% from Rs 49,128 crore in FY21.
RIL’s consolidated revenue for the year also surged 48% YoY to Rs 7,21,634 crore. The strong financial performance was led by growth across the board. RIL also became the first Indian company to cross $100 billion in revenue.
With a market capitalisation of more than Rs 16.37 lakh crore, RIL is the largest company in India. RIL stock price has risen over 13% in the last one year.
Oil & Natural Gas Corporation (ONGC)
The state-owned Oil & Natural Gas Corporation Ltd (ONGC) is the second most profitable company in India after Reliance Industries. In the financial year March 2022, ONGC earned a consolidated net profit of Rs 45,522.11 crore, witnessing a sharp jump of 179% from Rs 16,304.40 in FY21. The company’s consolidated revenue in FY22 surged to Rs 539,199 crore from Rs 369,796 crore, YoY.
ONGC is a state-run oil and gas exploration and production company. The company’s crude oil production in FY22 stood at 19.545 million tonnes and expects it to rise to 19.88 million tonnes this year. Its gas production in 2021-22 was at 20.907 billion cubic meters, which it expects to rise to 21.097 bcm in 2022-2023.
ONGC has a market capitalisation of around Rs 1,58,322 crore. Its stock has gained over 5% in one year. However, ONGC stock has been under pressure recently after the government imposed special additional excise duty of Rs 23,250 per tonne on domestically produced crude oil. The move is likely to severely hurt the benefits of elevated global crude oil prices to the earnings of ONGC.
Tata Steel reported a consolidated net profit Rs 40,153 crore in FY22, becoming the most profitable company in the Tata Group. The net profit in FY22 was 436% higher than Rs 7,490.22 crore earned in FY21. The company’s net sales during the year increased to Rs 2,42,326 crore from Rs 1,54,719 crore, YoY.
However, after a strong performance in FY22, Tata Steel’s earnings growth may slow down during the first quarter of FY2022-2023 amid certain headwinds faced by the metal sector. Heightened fears of a recession in the US have taken a toll on global commodity prices. Moreover, the recent levy of export duty on steel by the government and higher coking coal prices may dent the earnings performance of the company going ahead.
Tata Consultancy Services (TCS)
Tata Consultancy Services (TCS), the country’s largest software services exporter, posted a bottomline of Rs 38,327 crore in FY22, witnessing a growth of 18.18% over Rs 32,430 crore in the previous year.
The IT behemoth registered a topline growth of 17% at Rs 191,754 crore in FY22 as compared to Rs 1,64,177 crore in FY21.
TCS is the second-largest listed company in India with a market capitalisation of around Rs 11,84,489 crore. TCS shares have fallen over 13% YTD as against a 28% fall in the Nifty IT index during the same period amid global headwinds. The concerns over economic slowdown and impending recession in the US and Europe, the biggest markets for IT companies, are weighing on the sector.
HDFC Bank, the largest private sector lender, posted a net profit of Rs 38,052 crore in the financial year ended March 2022, registering a growth of Rs 19.54% YoY. Its total income during the year increased to Rs 167,695 crore from Rs 155,885 crore, YoY.
HDFC Bank’s total deposits as on March 31, 2022, jumped 16.8% YoY to Rs 15,59,217 crore, while its total advances increased 20.8% YoY to Rs 13,68,821 crore.
HDFC Bank is the third-largest Indian company with a market capitalization of Rs 7,49,864 crore on the Indian stock exchanges. The stock price of HDFC Bank has fallen over 8% in one year.
The next 5 companies on the list include the country’s largest lender State Bank of India (SBI) with an annual net profit of Rs 35,374 crore, private lender ICICI Bank with a net profit of Rs 25,110 crore, state-run Indian Oil Corporation with Rs 25,102 crore, the country’s largest mortgage lender Housing Development Finance Corporation (HDFC) with Rs 22,595 crore profit and the second-largest software services exporter Infosys with an annual profit of Rs 22,110 crore in FY22.
Disclaimer: This article is for information purposes only and should not be considered as stock recommendation or advice to buy or sell shares of any company. Investing in the stock market can be risky. It is therefore advisable to research well or consult an investment advisor before investing in shares, derivatives or any other such financial instruments traded on the exchanges.