159 listed firms saw ‘material impact’ due to Covid; cumulative EBITDA dipped this much in March quarter

Amid the Covid pandemic, a number of BSE-listed enterprises have witnessed “a material impact on financial performance indicators such as EBITDA, revenue, debt, and interest service coverage, provisions, profitability as and earnings per share (EPS),” a report by EY India said, as reported by PTI. According to an analysis of the March quarter results, announced till June 5, of the top 300 BSE-listed entities and 115 global companies across 12 sectors, BSE-listed 159 companies saw a decline of Rs 22,538 crore cumulatively in their EBITDA vis-à-vis December quarter “as early impacts of pandemic and resulting changes in macro-economic factors,” EY India said.

India’s first Covid case was reported in late January while the government had imposed a nation-wide lockdown on March 25. The restrictions were relaxed from May end onwards even as the lockdown has significantly hit economic activities.

The analysis was carried out based on the information around the Covid impact declared by the entities in their results or any public documents with respect to their quarterly reporting, according to EY India. Sectors hit with the negative influence of the Covid scenario and unfavourable macro-economic changes were banking, financial services and insurance (BFSI), travel, power, aviation, oil & gas, and automotive. However, there are sectors such as healthcare, pharmaceuticals, and telecom, barring provisions around AGR dues, experienced positive growth during the quarter.

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EY India noted that the “significant increase in provisions around credit loss, impairment, inventory write-downs and additional impact of Covid-19,” were among the main reasons for the hit companies took on their EBITDA and profitability. The aggregated provisions were of around Rs 25,000 crore including Rs 17,000 crore of credit loss provision by BFSI sector, Rs 2,000 crore of impairment provision contributed by power, metal and mining sectors significantly, and oil & gas sector’s inventory write-downs of Rs 5,500 crore. These numbers were for the 159 companies in the quarter ending March.

In comparison, however, 115 global companies reported Rs 2,52,000 crore of aggregate provisions due to these reasons, the report noted. It also showed that there were significant deferrals in reporting results for the March quarter on account of SEBI’s extension of timeline vis-à-vis March 2019. Out of the BSE-listed 300 companies, 141 were yet to declare their results as on June 5, EY India said in the report.