Corporate profits and profitability have bounced back more strongly than investment since the Covid-19 pandemic, with companies generating substantially higher returns from their existing assets even as the pace of fresh investment remains relatively moderate, according to a working paper by the Economic Advisory Council to the Prime Minister (EAC-PM).
The study found that aggregate profit before interest and tax (PBIT) rose 21.4% in FY24, compared with a 6.1% increase in gross fixed assets (GFA), which it uses as an indicator of fixed-asset investment.
