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Business Standard
6 days ago
- Business
- Business Standard
6 factors that will impact India Inc's earnings in the quarters ahead
The June 2-25 quarter (Q1-FY26) Nifty earnings are likely to be weak, with growth expected at only 5 per cent year-on-year (YoY). Excluding metals and oil marketing companies, earnings growth drops closer to 4 per cent. A significant drag comes from the private banking sector, which is expected to report its second consecutive quarter of declining earnings since March 2020. Meanwhile, the PSU banking sector is likely to report moderate earnings growth of 5 per cent, the lowest in 20 quarters. The auto sector is projected to see a year-on-year decline of 10 per cent. Pharma sector is expected to report 11 per cent year-on-year growth, marking a moderation after eight consecutive quarters of 15 per cent+ earnings growth. The chemical sector is expected to record 10 per cent year-on-year earnings growth, marking its second consecutive quarter of growth after seven quarters of decline. That said, there are six factors that will impact earnings growth in the quarters ahead. #1: Low inflation is dragging down revenue growth Low inflation is good for our economy and has resulted in an easy monetary policy as well as lower interest rates. Lower interest rates help higher valuations in the market. However, lower inflation also means lower nominal GDP growth. There is a strong linkage between nominal GDP growth and revenue growth. While real GDP growth in India will be robust in FY26, we see nominal GDP growth at 9 per cent being amongst the lowest over past 20 years given likely GDP deflator of under 3 per cent. Over the past 20 years, FY20 was the only year which saw a lower nominal GDP growth excluding Covid-impacted FY21. #2: Banks dragging down overall earnings The banking sector has a significant impact on overall earnings growth given that it accounts for over a third of the index. Over the past few years, a revival in bank earnings led by lower provisions and rising NIMs helped overall earnings growth. However, with interest rates falling NIMs are coming under pressure and bank earnings are lacklustre. This is dragging down overall earnings growth. Earnings growth #3: Margins peaking? Onus on revenue growth Analysts are forecasting FY26 EBITDA margins at 21.8 per cent, which will be the highest in a decade. While margins may not fall materially, we think margin increase from here will be difficult. Thus bulk of earnings growth will have to be accounted by increased revenue growth. #4: Trump tariffs can be a mixed bag We see a greater probability of Trump going ahead with his tariff plans from August 1st. This has the risk of raising inflation in the USA as tariffs seem to average well above the 10 per cent rate currently. Moreover, this could trigger a slow-down in the USA and impact growth across the world including India. So, while tariffs are overall negative in terms of a slowing global economy, the more specific impact on India depends on the contours of an Indo-US trade pact, if any. The key to watch is the tariffs on Indian goods relative to that on other countries it competes with. We think a tariff of around 15 per cent may relatively be good for India given that most competitors are currently at 20-30 per cent tariffs. #5: Consumption spend should improve Three factors will drive consumption spend over the next few months. First, the monsoons. Better monsoons have led to better sowing of crops. Some of this could be due to early sowing relative to last year since monsoons arrived ahead of the normal schedule. But with monsoons looking normal, we think agriculture growth will be strong this year leading to higher rural income. Second is urban consumption, which will be supported by the tax break of around Rs 1 lakh crores given in the budget in February 2025. Thirdly, lower interest rates and easy monetary conditions will lead to lower EMIs helping urban consumption. #6: Capex is better than consensus believes The consensus view is that the Government has done most of the heavy lifting on capex and private sector capex has been missing. The good news is that Government has continued to accelerate capex spend and has rightly front loaded its capex for the year. But the even better news is that the private sector capex has accelerated over the past 2 years. We still do not see anything like the animal spirits we saw in FY2004-07 phase. But even a more gradual recovery will help the economy and earnings. Listed corporate capex will practically double from FY22 to FY26. Listed corporate capex as per cent of Nominal GDP has moved up from 2.7 per cent in FY22 to 3.3 per cent in FY25.
Evening Standard
20-06-2025
- Sport
- Evening Standard
British and Irish Lions tour 2025: Results, fixtures, schedule and squad
The Lions famously recorded their first series win since 1997 on their last trip to Australia under Warren Gatland in 2013, before battling to a draw in New Zealand four years later and then being pipped 2-1 by the reigning world champion Springboks in the Covid-impacted tour of South Africa back in 2021.
Evening Standard
17-06-2025
- Sport
- Evening Standard
How to watch British and Irish Lions tour 2025: TV channel and live stream for every match
Here is all you need to know about how and where to watch every Lions game live this summer as they seek a first series win since their last visit to Australia under Warren Gatland in 2013 and only a second since South Africa in 1997, having drawn with the All Blacks in 2017 before being edged out by the reigning world champion Springboks in the Covid-impacted tour of 2021.
Evening Standard
17-06-2025
- Sport
- Evening Standard
British and Irish Lions tour 2025: Fixtures, schedule, squad and how to watch
The Lions famously recorded their first series win since 1997 on their last trip to Australia under Warren Gatland in 2013, before battling to a draw in New Zealand four years later and then being pipped 2-1 by the reigning world champion Springboks in the Covid-impacted tour of South Africa back in 2021.
Web Release
29-05-2025
- Science
- Web Release
AURAK Graduation Ceremony Sees Record Number of Female Graduates; AI Gains Prominence
Female graduates outnumbered males at the twin Commencement Ceremonies of the American University of Ras Al Khaimah (AURAK), while Artificial Intelligence (AI) took center-stage with the number of graduates doubling in just one year. The two graduation ceremonies (13th and 14th) saw a total of 331 graduate and undergraduate students receive their degrees, of which 188 (56.8 per cent) were female, reflecting the growing trend of women aspiring for careers and entrepreneurship. The second major takeaway was the rising prominence of AI in the career landscape. The ceremony saw the very first batch of the university's Bachelor in Artificial Intelligence receive their degrees. AURAK's Bachelor of Science in AI is a four-year program that empowers students to design and develop computer systems and data models, using the latest advances in the field. The 13th Graduation Ceremony (Class of 24) had extra significance attached to it, for these graduates had entered university in the thick of Covid-19 disruption, and had to navigate through the unknown territory of online classes. AURAK, listed among Top 500 Universities in the 2025 QS World University Rankings and occupying the sixth position among UAE universities, honored 68 graduates and 263 undergraduates at the two ceremonies held on successive days. Eight students earned the Summa Cum Laude (highest distinction) honor. H.E. Robert Raines, US Consul General in Dubai, who delivered the Commencement Adress, hailed the resilience displayed by the Covid-impacted graduates of the Class of 2024, and urged them to draw inspiration from the ghaf tree, whose roots go 60 meters into the soil. 'Remember your resilience. Remember that you can do this, whether you become scientists, teachers, entrepreneurs, engineers, artists or diplomats. You're entering a world that faces serious global challenges. You will need your resilience to survive and to succeed, and the world needs you to succeed. Second, I hope that you'll remember the value and the importance of community… because it is your community that will nourish you as you grow,' H.E. Robert Raines remarked. Dr. David A. Schmidt, President of AURAK, in his welcome address, said: 'The world you are stepping into demands resilience, adaptability and vision. You've proven that you can navigate uncertainty and adapt to the unexpected. You've pursued knowledge, not at the absence of obstacles, but often in the face of them. As we confer your degrees, we do more than acknowledge your academic accomplishments, we affirm your readiness to lead and to shape the future.'. Prof. Stephen C. Wilhite, Senior Vice President of Academic Affairs and Student Success / Provost, urged the graduates to carry the legacy of appreciation for diversity and a commitment to promoting cultural understanding and to fostering civic responsibility. 'Learning is a lifelong process through which you can leverage your knowledge and skills to become leaders and entrepreneurs who can change the world for the better,' he added. The graduates received their degrees in the presence of the Chairman of the AURAK Board of Trustees and other board members; H.E. Robert Raines, US Consul General in Dubai; AURAK President David A. Schmidt; and administrative leadership team and faculty of the university. The Valedictorian Address was delivered by Mohammed Ayyub, the topper in Bachelor of Science in Biotechnology with the highest CGPA of 3.95, on the first day. For the second Commencement Ceremony, there were two Valedictorians: Maryam Saeed Sanad Abdulla Alnaqbi (Bachelor of Science in Business Administration), the first Emirati to earn the honor in recent years, and Leen Mohammad Jamal Zaid (Bachelor of Science in Biotechnology).
