Economy Slowed, But These Sectors Didn’t—Here’s Where the Money Is Flowing!
Which Industries Are Thriving While the Market Struggles? Find Out Now!
The earnings season for Q3 is almost over and the results haven’t been much to speak about, except for the fact that they’re a tad bit better than the previous quarter i.e. Q2FY25. In aggregate, all 3500 companies that have reported results as of today have seen their revenue increase by only 5% and profit increase by only 7%.
Why is this slightly better than previous quarter? Well, as discussed here earlier, in Q2, even though these companies saw a 9% revenue growth, their profit fell by 2.9%.
I believe one of the best investment strategies is to focus our attention on sectors that have outperformed the rest — and attempt to gauge whether the factors that have led to this outperformance will still remain relevant in the forthcoming quarters. Once we determine that, then the next step is to find the leading companies in those outperforming sectors.
In this post, I map the sectors that have reported both revenue as well as profit growth of at least 10% in Q3.
Remember that in Q2, the economy slowed down sharply by 5.4%, mainly owing to high inflation. Only now has inflation showed signs of easing. The Consumer Price Index (CPI) has fallen from a high of 6.2% in October 2024 to 4.3% in January 2025. Automobile sales have also starting picking up — passenger vehicle sales, a proxy for urban consumption, increased by 14.89% in Jan 2025 (it had fallen by 2.11% in December 2024). To be sure, this pickup needs to sustain. It would be imprudent to conclude that the economy is recovering simply by looking at one month’s macro data.
That said, those sectors that have especially demonstrated a strong revenue and profit growth (of more than 10%) in this ongoing economic slowdown deserve to be studied deeply.
Which exactly are these sectors?
Well, I collated the results of about 3500 companies that have reported Q3 results as of today, and if you notice the table below, a total of 14 major industries have reported strong revenue and profit growth despite an economic slowdown in India.