We are pleased to launch the eighth edition of our Industry Multiples India Report for the quarter ended June 2019. The report provides an overview of market multiples of companies in 23 major industries in the S&P BSE 500 Index.
- The media, apparel and energy sectors experienced the largest decline in multiples during this quarter. Media advertisement revenue decreased due to implementation of a new tariff order by the Telecom Regulatory Authority of India (TRAI) in May. India's apparel exports to developed countries fell by around 15.0% due to a slowdown in demand, weak economic activity and loss of market share to Bangladesh and Vietnam.
- Energy and metals stock prices fell as trade tensions intensified in May. This, coupled with moderate domestic demand, led to a sharp decline in global commodity and fuel prices. Further, the pharmaceuticals sector also experienced a decline due to weakness in the domestic formulation business during this quarter. The auto sector continues to experience sell-offs due to sharp contraction in demand in both urban and rural markets, leading to an inventory pile up.
- On the other hand, internet software and renewable electricity producers witnessed an increase in multiples during this quarter. Renewable electricity producing companies witnessed improved operating performance during the March 2019 quarter on account of higher plant load factor (PLF). This, coupled with foreign investors' interest in India's green energy initiative, resulted in an increase in multiples.
Our report provides a detailed overview of the P/B, P/E, EV/ EBITDA and EV/sales multiples of companies in the S&P BSE 500 Index across 23 major industries for which such data is available. We hope you find this report helpful to get a broad sense of the range of trading multiples for major industries in India. If you would like to receive further information or discuss any findings of this analysis, please contact us.
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