Indian companies are likely to see a moderation in revenue growth and lower EBITDA margins in the July to September quarter, primarily due to decline in consumer confidence, on account of high inflation and rising interest rates and slowdown in investment growth, said a report by CRISIL Research.

Based on an analysis of the aggregate financial performance of select companies across 21 industries (excluding banks and oil companies), CRISIL expects year-on-year (y-o-y) revenue growth of around 15 per cent, as compared to 19 per cent in the preceding quarter and 22 per cent in the corresponding quarter last year.

Although companies have hiked prices, slower volume growth, along with high input costs and rising wages, would put pressure on margins, the report said.

CRISIL expects a 100 basis points (bps) reduction in EBITDA margins in Q2 FY12 from 19.5 per cent during April-June 2011.

Further, with increase in interest rates, net margins are expected to fall even more sharply. During the second quarter, real estate players are likely to report a 5 per cent y-o-y decline in revenues and a sharp reduction in EBITDA margins.

Automakers, textiles and steel manufacturers are expected to see a sharp decline in margins on the back of slower offtake and high raw material costs.

For cement and construction players too, EBITDA margins are likely to remain under pressure owing to slowdown in pace of project execution as well as rising input costs. IT services providers are expected to report buoyant revenue growth of around 17 per cent on the back of strong pipeline. However, EBITDA margins are likely to decline by around 200 bps due to rising salary costs, the report said.

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