In the March 2024 quarter, total listed company earnings grew by 55.8% from a year ago to Rs76 billion, marking the second consecutive year-on-year quarterly growth, “indicating a steady economic progress fueled by improving economic sentiment,” First Capital Research said in June 2024.
Total earnings of listed stocks grew 90% in the December 2023 quarter after declining year-on-year for four quarters in September 2023 (4%), June 2023 (69.4%), March 2023 (64%) and December 2022 (44%).
Earnings from the food, beverage and tobacco sector grew 123%, driven by the reduction in overall finance cost and operating expenditure, improved consumer sentiment, and an influx of tourist arrivals.
Banking earnings increased 52% on the significant decline in impairment costs despite the prevailing low-interest rate environment while benefiting from reduced provisions for foreign currency-denominated ISB investments.
Consumer durables and apparel sector earnings surged 392% on a sustained recovery in consumer demand due to improving market conditions.
The telecommunications sector comprising Dialog and SLT saw combined earnings fall 70% due to weaker performance in fixed telephony and broadband operations partly attributed to the tariff hike corresponding to the 3% rise in VAT since January 2024, intense competition from new-gen technologies, and a sharp reduction in foreign exchange gains due to currency appreciation. Furthermore, the previously high inflation suppressed consumer spending on telecommunication services while elevated costs limited margin expansion, First Capital noted.
Energy sector earnings declined 67% on margin contractions exacerbated by price reductions, global geopolitical tensions, and currency fluctuations.
Transportation sector earnings tumbled 353% on trade protectionism, high energy prices, geopolitical tensions, persistent inflation and tightening global monetary policies that reduced imports and dampened consumer demand, resulting in decreased air and ocean freight volumes.