Indian corporate earnings saw a strong first quarter with Nifty profit rising 18% year-on-year, led by the financial, metal, and oil sectors. Following these results, Motilal Oswal has raised its earnings estimates for the Nifty index, while highlighting specific companies that showed resilience despite pressure in other segments.
The Indian corporate sector delivered a strong performance in the first quarter of fiscal year 2027. According to a recent analysis by the brokerage firm Motilal Oswal, the Nifty index saw an 18% increase in profit after tax compared to the same period last year. This result was significantly higher than the initial market expectation of a 10% rise, marking the strongest profit growth for the index in the last ten quarters.
The positive momentum was driven largely by the financial services, metals, and oil and gas industries. A small group of companies—specifically ONGC, Hindalco Industries, Reliance Industries, JSW Steel, and Bharti Airtel—accounted for 60% of the total profit growth recorded during the quarter. However, the report also identified specific areas of weakness. Companies such as InterGlobe Aviation, ITC, Dr. Reddy's Laboratories, Tata Motors (PV), and Cipla, along with oil marketing companies, acted as a drag on the overall earnings growth of the index.
Reflecting this performance, Motilal Oswal has adjusted its earnings per share (EPS) estimates for the Nifty index. The EPS, which represents the portion of a company's profit allocated to each share of stock, has been raised by 0.6% to Rs 1,232 for FY27. The forecast for FY28 was also adjusted slightly upward by 0.3% to Rs 1,425. A key indicator of market health highlighted in the report is the upgrade-to-downgrade ratio, which stands at 1.5x. This indicates that a higher number of companies received upward revisions in their earnings outlook compared to those that saw downgrades.
Notable Companies in the Report
The report spotlighted several companies that captured attention during this earnings season. Among the Nifty 50 constituents, the brokerage listed firms such as Bharti Airtel, ICICI Bank, State Bank of India, Titan Company, Mahindra & Mahindra, Bharat Electronics, Apollo Hospitals, Hindalco, Shriram Finance, and InterGlobe Aviation.
In the non-Nifty-50 segment, the analysis covered stocks like TVS Motor, BSE Ltd, GE Vernova T&D, HDFC Asset Management Company, Indian Hotels, Nykaa, Dixon Technologies, Coforge, Radico Khaitan, Delhivery, Kirloskar Oil Engines, RBL Bank, TBO Tek, and Arvind Ltd.
Investors looking at these results should note that while the aggregate numbers are strong, the performance was not uniform across all sectors. The key monitorable for the coming quarters will be whether companies can sustain these profit margins, particularly in sectors that faced pressure during Q1. Future updates on demand trends, input costs, and management commentary will remain important for tracking the sustainability of this earnings growth.