The Nifty 50 index is comprised of some of the biggest companies in India which are expected to do well over a long period of time. However, there are always a few companies that need a second look before adding them to a blue-chip portfolio.
In case you are wondering, which companies remained the least efficient in FY23, here’s a list of 3 companies that secured the lowest PAT margins from Nifty 50.
Bharat Petroleum Corporation Limited
Bharat Petroleum Corp. Ltd. (NS: BPCL ) is an oil refining and marketing company, with a market capitalization of INR 77,154 crores. FY23 was a tough year for these companies as the government’s cap on fuel prices to curb soaring inflation led to losses and as a result, BPCL’s net income tanked a whopping 81.7% to INR 2,131.05 crores.
This lower profit figure was recorded despite a 35.5% YoY jump in FY23 revenue to INR 4,76,877.32 crores, translating into a negligible profit margin of 0.45%, which was the lowest among all index constituents.
Tata Motors Limited
Tata Motors Ltd (NS: TAMO ) is a well-known auto manufacturer with a market capitalization of INR 1,96,019 crores. This is an interesting counter. The company was able to register a record revenue of INR 3,52,431.09 crores in FY23, however, its net income was recorded at only INR 2,077.91 crores, translating into a profit margin of only 0.59%.
But this does not tell the whole story, The company was able to turn profitable after 4 consecutive years of losses and this turnaround story is also visible looking at its share price which is not just trading at a 6-year high, but also outperformed the Nifty 50 index return in the last 12 months, with its 26.3% gain, compared to the latter’s 12.2% rally.
Adani Enterprises Limited
Adani Enterprises Ltd (NS: ADEL ) is the flagship company of the Adani Group, with a market capitalization of INR 2,77,470 crores. The entire group is currently under the lens of regulators over alleged fraudulent practices, the conclusion of the scrutiny is yet to be drawn. Not commenting on the ongoing turmoil but the financial numbers seem not so strong.
The company was able to scale to a record-high revenue of INR 1,38,175.12 crores in FY23, which was an impressive 96.1% YoY growth. The net income witnessed a mammoth YoY jump of 191% but still, the absolute figure reached to only INR 2,260.28 crores. This means a profit margin of only 1.64%.
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