Nifty companies have been making headlines lately, with 27 of them reporting a 9.11% year-on-year rise in net sales in Q4, totaling a whopping Rs 10,20,173 crore compared to Rs 9,34,972 crore in the same period last year. Some big players like Eternal Ltd, Trent Ltd, and Infosys Ltd haven’t been as fortunate, seeing their profits drop by 77%, 54%, and 11%, respectively.
The earnings season has been somewhat predictable, with companies like Eternal Ltd, Trent Ltd, Bajaj Finance Ltd, Adani Ports and Special Economic Zone Ltd, Shriram Finance Ltd, and Mahindra & Mahindra Ltd posting impressive 20-64% YoY rise in net sales. On the profit side, Adani Enterprises Ltd, Tech Mahindra Ltd, Tata Consumer Products Ltd, Adani Ports, and Wipro Ltd have been leading the pack in terms of growth.
Overall, the 27 Nifty companies have managed to boost their net sales by 9.11% to Rs 10,20,173 crore, with profits growing by 6.59% to Rs 1,50,082.68 crore. It seems like the heavyweights are driving the show, as MOFSL reports that 24 out of these companies have seen a 7% YoY profit increase, surpassing the estimated 5% YoY growth.
However, it’s not all sunshine and rainbows for everyone. Eternal Ltd, Trent Ltd, and Infosys Ltd have taken a hit with profits plummeting by 77%, 54%, and 11% respectively. Adani Enterprises Ltd and SBI Life Insurance Company Ltd have also reported a decrease in sales, with Wipro Ltd, Hindustan Unilever Ltd, Nestle India Ltd, and Tech Mahindra Ltd only seeing single-digit growth in sales.
Despite some bumps in the road, the earnings spread has been decent overall, with 78% of companies meeting or exceeding profit expectations. Axis Securities predicts market consolidation in the near future, with a focus on style and sector rotation along with earnings recovery. They believe that domestic-facing sectors will have the upper hand due to the impact of reciprocal tax, while export-oriented sectors will have to wait and watch.
Kotak Institutional Equities, on the other hand, feels that the Street is being too optimistic in its earnings estimates, especially for export-oriented sectors like automobiles, IT services, and pharmaceuticals. With high levels of uncertainty in global GDP growth and tariffs in the US, profitability for consumption companies might take a hit.
MOFSL notes that the market has bounced back strongly in the last two months, erasing its year-to-date decline. The Nifty is currently trading 2.9% higher in CY25YTD, with a P/E ratio of 21x FY26E earnings. While near-term challenges are expected to keep the market volatile, the long-term growth narrative for India remains intact.
In terms of stock preferences, MOFSL favors largecaps like Reliance Industries, Bharti Airtel, ICICI Bank, HUL, L&T, Kotak Mahindra Bank, M&M, Titan, Trent, and TCS. For midcaps and smallcaps, they like Indian Hotels, HDFC AMC, Dixon Tech, JSW Infra, BSE, Coforge, Page Industries, IPCA Labs, Suzlon Energy, and SRF.
So, it seems like the Nifty companies are holding their ground, with some shining bright and others facing challenges. The market might be in for some twists and turns, but one thing’s for sure – the Indian market is resilient and ready to weather the storm.