India Inc. Sees Strongest Earnings Rebound in Over a Year
India’s corporate sector is witnessing its most robust earnings recovery in more than a year, with brokerages growing increasingly optimistic about profit momentum in the second half of the fiscal year. Cooling inflation, substantial tax cuts on consumer goods and supportive monetary policies have driven a broad revival in consumption. Early festive-season data also indicates a strong uptick in discretionary spending, further lifting overall demand.
Profit growth among BSE 500 companies accelerated to 16.6% in the September quarter, compared to 10.7% in the previous quarter and a slight contraction a year ago, according to Emkay Global. Oil marketing firms, telecom, metals, technology, non-bank lenders and capital goods led the earnings surge, while autos and large banks softened aggregate performance. Heavyweights including Bharti Airtel, Tata Steel, HDFC Bank, Reliance Industries and TCS contributed significantly to Nifty 50 earnings growth, indicating improving breadth across corporate India.
Market sentiment remains upbeat, with the Nifty 50 trading just 1% below its all-time high as stable tax revenues, strong credit growth and improving earnings visibility support valuations. Nearly half of MSCI India constituents beat estimates, and mid-caps hit a record high in November. Jefferies reported that early festive demand helped push revenue growth to a 10-quarter peak, reinforcing expectations of double-digit earnings expansion in FY26’s second half and into FY27.
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