Latest news with #NSE500
Time of India
2 days ago
- Business
- Time of India
Rs 15 lakh crore in net profit! India Inc's top 500 cos break records in FY25 despite downgrades
India's top 500 companies achieved a record-breaking ₹15 lakh crore in net profit in FY25, driven by strong performances in agriculture, chemicals, and telecom, despite widespread earnings downgrades. While FY26 earnings forecasts have been revised downward, analysts remain optimistic about sectors like defence and telecom, anticipating continued growth and resilience in the face of economic uncertainties. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads India's top 500 companies have smashed past an all-time milestone, raking in over Rs 15 lakh crore in net profit in FY25, a historic high that underscores the resilience of corporate India, even as earnings faced widespread downgrades in the last 4 compiled by Axis Securities shows that NSE 500 's cumulative profit jumped from Rs 10.66 lakh crore in FY23 to Rs 15.07 lakh crore in FY25, based on the last four quarters ending Q4FY25 on a rolling basis. This includes results from 458 companies. The new peak for corporate profitability in FY25 was powered by strong showings from agriculture & chemicals, telecom, and profit surged 11.4% during the financial year. Telecom profits surged 45.7%, while staples, healthcare, and agriculture and chemicals posted solid 10.8–13.1% gains. Banks grew at a modest 4.8%, while oil & gas profits dropped 10.2%.From FY21 to FY24, profit growth clocked a stellar 26% CAGR for NSE 500 companies. FY25 growth slowed to 10%, but excluding oil & gas, metals & mining, earnings rose 18.9%, Axis with this deceleration, the market's profit engine hasn't stalled. According to Axis Securities' Head of Research Neeraj Chadawar, sectors that were deep in losses during the pandemic have now turned positive. He noted that financials, oil & gas, metals, and IT together contribute 65% of NSE 500 said largecap companies are showing a recovery in earnings momentum, with 81% of Nifty companies beating or meeting earnings expectations in the March market optimism is being reined in. FY26 Nifty earnings have been downgraded by 3.3% and FY27 by 2%, Axis noted. The revision stems partly from index reshuffling — Zomato and Jio Financial have replaced BPCL and Britannia, altering index-level expectations. Adjusted for this change, the downgrade for FY26 is a more modest 2%.Axis projects Nifty EPS at Rs 1,151 for FY26 and Rs 1,315 for FY27, and sees 14% CAGR earnings growth between FY23–27. But concerns persist. 'Trade policy uncertainty, rupee depreciation, and relatively higher valuations remain key risks to near-term market multiples,' it added. Nonetheless, the firm has upgraded its base-case Nifty target for March 2026 to 26,300, valuing it at 20x FY27 Oswal reported that FY25 Nifty EPS ended at ₹1,013, up just 1% YoY on a high base. FY26 EPS was cut by 1.9% to ₹1,135, with sharp revisions in SBI, ONGC, IndusInd Bank, Tata Motors, and TCS. FY27 was trimmed 1.1% to ₹1,314. 'Forward earnings revisions are weakening, with downgrades outpacing upgrades,' the firm warned, despite a better-than-expected Q4FY25 also flagged that while aggregate FY25 profit growth came in at 8%, the outlook is softening. Consensus EPS forecasts for FY26/27 have already been revised down 2.3% and 1.4% since March. Since September 2024, that's a 7.6% and 6.3% cut, respectively. The firm expects further 4–8% earnings downgrades for FY27, citing weak exports, reduced household financial savings, and a sluggish investment noted that all sectors saw FY26 EPS downgrades except oil marketing companies, with the worst cuts in tech, construction, FMCG, and energy. Downgrade/upgrade ratios stood at a steep 3.5x, and RoEs compressed by 30 bps over the last six these cuts, analysts are optimistic about FY26. Sectors like defence, telecom, India-focused pharma, and hospitals are expected to sustain high visibility and strong growth. Cement and metals could also surprise positively due to input cost story is clear: corporate India just delivered its most profitable year ever, even amid macro headwinds and a downgrade-heavy season. While the forward path appears bumpier, the profit engine is still running strong — and FY26 is shaping up to be another test of resilience.: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
Economic Times
2 days ago
- Business
- Economic Times
Rs 15 lakh crore in net profit! India Inc's top 500 cos break records in FY25 despite downgrades
India's top 500 companies achieved a record-breaking ₹15 lakh crore in net profit in FY25, driven by strong performances in agriculture, chemicals, and telecom, despite widespread earnings downgrades. While FY26 earnings forecasts have been revised downward, analysts remain optimistic about sectors like defence and telecom, anticipating continued growth and resilience in the face of economic uncertainties. Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads Tired of too many ads? Remove Ads India's top 500 companies have smashed past an all-time milestone, raking in over Rs 15 lakh crore in net profit in FY25, a historic high that underscores the resilience of corporate India, even as earnings faced widespread downgrades in the last 4 compiled by Axis Securities shows that NSE 500 's cumulative profit jumped from Rs 10.66 lakh crore in FY23 to Rs 15.07 lakh crore in FY25, based on the last four quarters ending Q4FY25 on a rolling basis. This includes results from 458 companies. The new peak for corporate profitability in FY25 was powered by strong showings from agriculture & chemicals, telecom, and profit surged 11.4% during the financial year. Telecom profits surged 45.7%, while staples, healthcare, and agriculture and chemicals posted solid 10.8–13.1% gains. Banks grew at a modest 4.8%, while oil & gas profits dropped 10.2%.From FY21 to FY24, profit growth clocked a stellar 26% CAGR for NSE 500 companies. FY25 growth slowed to 10%, but excluding oil & gas, metals & mining, earnings rose 18.9%, Axis with this deceleration, the market's profit engine hasn't stalled. According to Axis Securities' Head of Research Neeraj Chadawar, sectors that were deep in losses during the pandemic have now turned positive. He noted that financials, oil & gas, metals, and IT together contribute 65% of NSE 500 said largecap companies are showing a recovery in earnings momentum, with 81% of Nifty companies beating or meeting earnings expectations in the March market optimism is being reined in. FY26 Nifty earnings have been downgraded by 3.3% and FY27 by 2%, Axis noted. The revision stems partly from index reshuffling — Zomato and Jio Financial have replaced BPCL and Britannia, altering index-level expectations. Adjusted for this change, the downgrade for FY26 is a more modest 2%.Axis projects Nifty EPS at Rs 1,151 for FY26 and Rs 1,315 for FY27, and sees 14% CAGR earnings growth between FY23–27. But concerns persist. 'Trade policy uncertainty, rupee depreciation, and relatively higher valuations remain key risks to near-term market multiples,' it added. Nonetheless, the firm has upgraded its base-case Nifty target for March 2026 to 26,300, valuing it at 20x FY27 Oswal reported that FY25 Nifty EPS ended at ₹1,013, up just 1% YoY on a high base. FY26 EPS was cut by 1.9% to ₹1,135, with sharp revisions in SBI, ONGC, IndusInd Bank, Tata Motors, and TCS. FY27 was trimmed 1.1% to ₹1,314. 'Forward earnings revisions are weakening, with downgrades outpacing upgrades,' the firm warned, despite a better-than-expected Q4FY25 also flagged that while aggregate FY25 profit growth came in at 8%, the outlook is softening. Consensus EPS forecasts for FY26/27 have already been revised down 2.3% and 1.4% since March. Since September 2024, that's a 7.6% and 6.3% cut, respectively. The firm expects further 4–8% earnings downgrades for FY27, citing weak exports, reduced household financial savings, and a sluggish investment noted that all sectors saw FY26 EPS downgrades except oil marketing companies, with the worst cuts in tech, construction, FMCG, and energy. Downgrade/upgrade ratios stood at a steep 3.5x, and RoEs compressed by 30 bps over the last six these cuts, analysts are optimistic about FY26. Sectors like defence, telecom, India-focused pharma, and hospitals are expected to sustain high visibility and strong growth. Cement and metals could also surprise positively due to input cost story is clear: corporate India just delivered its most profitable year ever, even amid macro headwinds and a downgrade-heavy season. While the forward path appears bumpier, the profit engine is still running strong — and FY26 is shaping up to be another test of resilience.: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of the Economic Times)
Mint
3 days ago
- Business
- Mint
It will be tougher to generate market-beating returns over medium term, says ICICI Pru AMC's Shah
The Indian market is entering a phase of subdued returns over the medium term as it will be tougher to generate alpha or excess returns over an underlying benchmark, according to Anand Shah of ICICI Prudential Asset Management Co. 'I think the biggest event (ahead) will be the end of the 90-day tariff pause— that remains the key event," said Shah, chief investment officer-portfolio management services and alternative investment funds at India's second-largest asset manager. Also Read | ICICI Prudential: Street is pinning hopes on margin recovery The real challenge for equities is sentiment and behaviour, he said. While corporates and banks remain cautious, markets have priced in overly optimistic global outcomes—risking disappointment, as seen since September 2024, he said. Edited excerpts: How do you interpret the current market volatility? There is noticeable uncertainty surrounding Trump's tariff policies. In the short term, the market will always be volatile on either side. And with every result, you will have a different reaction. The more important aspect is the medium-term. If you look at the period from 2010 to 2020, the GDP growth rate was normal—around 11 to 12% CAGR (compound annual growth rate). However, India Inc. was suffering. So, India Inc.'s profitability from 2010 to 2020 was very low—in the single digits, around 2 to 3% CAGR. Also Read | ICICI Prudential has growth cover in place If I break that down further, the NSE 500 profits-to-GDP fell from 4.7% in 2010 to almost 2.7% in 2018–19, and then to 2% in 2020, which was a Covid year. But that sharp drop in profits-to-GDP meant GDP grew, but profits did not. If I break that down even more, that fall was sustained by the ₹60,000 crore capital-intensive businesses between 2015 and 2019 across about 19 sectors. The profit growth we saw from corporate India in 2020 to 2024, and likely up to March 2025, has been quite strong. And that, too, was led by the cyclical, capital-intensive businesses and the banks. Whereas the defensive sectors—FMCG (fast-moving consumer goods), IT, pharma—were actually beneficiaries of lower commodity prices. They were doing well all the way up to 2020, and even into 2021. But from 2021 till date, they have been big underperformers. They had become very expensive by the end of 2021. Another segment of the market—more cyclical and value-oriented—started to perform better. So that sort of reversal is happening in the market in the medium term. For us, if you see the last four years—2020 to 2024—profit growth has been around 35% CAGR for India. This year also looks strong. So over five years, it should be in the 30%+ CAGR range, which is much higher than what we saw in the previous decade. What about the medium-term expectation? For the next few years, which is the medium term, I believe it will be more subdued. So while we had a 20–25% earnings growth rate in recent years—which benefited the market, plus added alpha—that was because if you were in cyclical, capital-intensive, corporate banks, PSUs, you did extremely well compared to the market. Also Read | Charlie Munger shaped investing strategies beyond numbers writes S Naren If you were in defence, you were in base capital-intensive sectors—everything was at 50%, 60%, 70% discount to book value. You had tons of value, and India was trading below the book value in many areas. So that part of the story is also, I won't say completely done, but has played out to a large extent. And to that extent, going forward, we should expect the earnings growth rate to again normalize, around the nominal growth rate of 10–11%, maybe a bit lesser. Alpha-rich opportunities will also be fewer and far between. It will be tougher to generate alpha going forward. So I think we are entering a new phase of the market—still positive, but the returns will be far more subdued than what you have seen in the last few years. What kind of returns do you expect from Nifty 50? Over the 15-year period from 2010 to 2025, GDP growth has averaged around 11.3%, with NSE 500 earnings growing at about 11.6%. While stock performance has been notably strong in the last four years, over the full period, NSE 500 returns have broadly tracked earnings, averaging close to 11%. So, I think the market's long-term growth links closely to nominal GDP and profit growth. EPS (earnings per share) growth is key, and I expect it to be around 11 to 12% at most, which will be reflected in the broader market. From here, stock-picking becomes crucial. You'll need to focus on select sectors and avoid others to generate alpha. Does that imply investors should consider increasing their exposure to fixed income and precious metals? Investors should consider increasing exposure to fixed income and precious metals for a balanced portfolio. Over the long term, diversification remains essential—balancing equities, fixed income and alternatives. Even if the market delivers 10–12% compounding returns going forward, that is still better than most other asset classes. So, maintain the right equity exposure based on your goals and risk profile. If you are significantly overweight on equities, it may be a good time to review your portfolio and consider reducing your exposure. How do you balance between large-, mid- and small-cap segments, especially given the recent sharp recovery and the broader market correction of 20–30%? With alpha-generating opportunities becoming limited, where do you see the potential now—are large-caps set to lead, or do mid- and small-caps still offer better prospects? We were significantly overweight on mid- and small-caps starting in 2022, but we reduced our exposure shortly after. Post-FY24, mid- and small-caps saw a sharp correction, which made those segments relatively less risky. It had been an unprecedented rally, with almost everything doing well. Looking at the data from late February to early April—when the market bottomed—that period presented a good opportunity to increase our exposure to small-caps. On the way down, we selectively added to our mid- and small-cap positions, remaining stock-specific in our approach. Mid-caps, as a basket, still look expensive, while small-caps and large-caps appear more reasonably valued. That said, despite high valuations in certain areas, a few select stocks stood out and were added to our portfolio. What are the factors that we need to watch out for? I think the biggest event will be the end of the 90-day tariff pause—that remains the key event. India has signed a UK FTA (free-trade agreement), and we are also looking forward to a potential FTA with the US. Relatively speaking, some developments are already priced in or at least partially expected—for example, the rate cuts anticipated from the Reserve Bank of India (RBI). That's the third major factor: policy direction and potential rate cuts. Another important area is commodity prices. You cannot ignore crude prices, especially given our import dependence and energy needs. With crude and other commodities coming off (peaks), that is clearly a positive. We are closely watching developments in Russia, Israel, Iran and the US—all of which are influencing global prices. And last, but not least, government spending is helping drive recovery, and a large part of the slowdown in the domestic economy could be attributed to the cautious fiscal stance around elections. What about private capex? Private capex has started picking up, but not in a significant way. While cash flows are improving and interest rates are easing, companies remain cautious. We are still far from the scale seen between 2004 and 2010, when private investment surged—that kind of momentum is missing. Multiple uncertainties have contributed: Covid, the Russia-Ukraine conflict, India's elections, China's slowdown and uncertainty around US policy. All of this is making the private sector hesitant to commit large capital. China plays a key role here. Its excess capacity and export redirection to countries like India are putting pressure on domestic margins, creating further investment hesitation. However, in the medium term, this could present an opportunity. As global supply chains diversify, countries like Vietnam, Bangladesh, Mexico—and potentially India—stand to benefit. In sectors like textiles, India isn't uncompetitive, but tariff differentials with countries like Bangladesh and Vietnam are a disadvantage. Trade deals like the UK FTA could help address this and spur investment. So while near-term caution remains, some of these headwinds could turn into tailwinds for private capex if global and policy dynamics shift in our favour. Given the recent concerns and the noticeable flight of capital from the US, I wanted to get your perspective on how India is positioned within the broader global investment landscape. From the foreign portfolio investor (FPI) inflow point of view, do you see capital moving more aggressively toward China, or do you think the shift will be more balanced — perhaps favouring both India and China equally? Despite the US running a large deficit, the dollar has continued to remain strong. If that were to reverse—if the currency were to weaken from here—financial investors holding US assets, especially equities, could start diversifying out. We're already seeing signs of that. European equities have seen some flows, and in India, while flows are mixed, some have turned positive, with increased interest in Indian equities. China is a more complex story—there's direct uncertainty, and it's hard to say how that will play out. But yes, parts of the markets, like Taiwan, have benefited, and the Taiwanese dollar has appreciated significantly. European currencies like the euro and Germany's economy are also seeing some support. Latin American currencies, too, to some extent, are appreciating, making financial assets there more attractive. If this shift continues, it could support countries like India, helping both the government and RBI stimulate the economy more effectively. Of course, all of this is speculative for now—we're watching closely. The biggest investors remain in US equity and bond markets, and how they react, especially in terms of carry trade positions, will be key. Which sectors are you overweight and underweight on? We continue to be overweight on manufacturing and still like metals. We are also positive on allied businesses like some corporate banks, where we remain overweight. When it comes to the consumption space, we believe it is evolving beyond just products. The data shows that while premium consumption is steady, especially among HNIs (high-net-worth Indians), there is also an emerging class moving up the pyramid. Traditional consumption—like FMCG products such as shampoos and packaged goods—seems to be saturating. Today, discretionary spending is shifting more toward services: financial services, healthcare, travel and organized retail. Even the way people purchase goods is becoming more experience- and status-driven. One thing that you think investors are probably underestimating? I think the biggest risk today is in investor expectations. People have gotten used to a market that hasn't seen any major correction—not even a 10% drop—from June 2022 to September 2024. That's made investors complacent, and that's a bigger risk than any real economic concern. From a macro perspective, India is fine. Economic conditions are stable, the currency is holding up, forex reserves are healthy, and current account deficits are at manageable levels. India remains one of the fastest-growing large economies and the largest democracy, so there are no major structural concerns there. The real challenge for equity markets is sentiment and behaviour. Corporates are being cautious, not overspending, and private capex is still conservative. Banks are also lending carefully, especially for capex-heavy projects. In contrast, market participants have priced in a more optimistic global scenario than what may actually play out—and that can lead to disappointments, as we've seen since September 2024. Minor corrections are not just likely, but healthy. Valuations had become stretched, especially for retail-heavy stocks. Flows have slowed, and if you look at cross-sector investment activity, it has moderated—which is the right thing. The rally of the past four to five years was exceptional, but that can't continue at the same pace.
Economic Times
26-05-2025
- Business
- Economic Times
What does Nifty's surge above 200-DMA mean for investors?
Agencies Live Events (You can now subscribe to our (You can now subscribe to our ETMarkets WhatsApp channel Mumbai: The recent rebound in the stock market has pushed the Nifty above its 200-Day Moving Average (DMA)-a long-term trend indicator-signalling a bullish undertone among blue chips. Beneath the surface, the optimistic mood may not be as widespread, but it's more sanguine than it was a couple of months the top 500 stocks, 226 are trading above 200-day moving averages, according to Axis Securities . When a stock or an index is above its 200 DMA, it's said to be in a long-term uptrend and vice versa. It's the average price of a stock or index over the last 200 trading days, which is close to a full trading year, helping investors get a better view of the price trends over a longer period. Nifty's 200-DMA is at 24,631, about 0.9% below Friday's closing level of 24, the stocks that are above 200-DMAs are still less than 50% in Nifty 500 index, it's higher compared to 95 in March and 45 in February, a sign of gradually improving investor confidence with a tinge of caution."The investor sentiment has improved significantly since February-March as the broader market has witnessed renewed buying interest, but the recovery is gradual as investors remain selective buyers focusing on companies that delivered good results," said Ruchit Jain, vice president- head technical research at Motilal Oswal Financial Services Of the stocks trading above 200- DMA, 62 are trading 10-20% away from the average price and 15 are at a 20-30% distance, while 138 are as much as 10% away. 11 stocks are trading 30% above their 200-DMA, according to Axis. Similarly, 162 stocks are up to 10% below the 200- DMA, 69 are 10-20% below the level, and 25 are over 20% bullish conditions, fewer than 50% of the top 500 stocks below the 200-DMA would not be a reason to celebrate, but given the lingering concerns over the economic fallout of tariffs and uncertainty over corporate earnings, optimists would consider this number acceptable.'Despite the muted fourth quarter earnings, a greater number of stocks out of the NSE 500 universe are trading above the 200-DMA compared to February and March, indicating investor confidence is returning on the street,' said Rajesh Palviya, head of technical and derivatives, Axis Nifty 500 Index slumped by nearly 8% in February but bounced back in March and April, gaining 7.3% and 3.2%, respectively. The Nifty Midcap 150 and Smallcap 250 indices have risen 17.6% and 20.2%, respectively, from their lows this year on February 28 and March 3.'Mid-caps moved up when domestic investors bought, and large-cap names performed well when foreign investors began purchasing after a period of aggressive sell-off, so there has been rotation among the stocks,' said Jain.
Time of India
26-05-2025
- Business
- Time of India
What does Nifty's surge above 200-DMA mean for investors?
Mumbai: The recent rebound in the stock market has pushed the Nifty above its 200-Day Moving Average (DMA)-a long-term trend indicator-signalling a bullish undertone among blue chips. Beneath the surface, the optimistic mood may not be as widespread, but it's more sanguine than it was a couple of months ago. Of the top 500 stocks, 226 are trading above 200-day moving averages, according to Axis Securities . When a stock or an index is above its 200 DMA, it's said to be in a long-term uptrend and vice versa. It's the average price of a stock or index over the last 200 trading days, which is close to a full trading year, helping investors get a better view of the price trends over a longer period. Nifty's 200-DMA is at 24,631, about 0.9% below Friday's closing level of 24,853. Though the stocks that are above 200-DMAs are still less than 50% in Nifty 500 index, it's higher compared to 95 in March and 45 in February, a sign of gradually improving investor confidence with a tinge of caution. "The investor sentiment has improved significantly since February-March as the broader market has witnessed renewed buying interest, but the recovery is gradual as investors remain selective buyers focusing on companies that delivered good results," said Ruchit Jain, vice president- head technical research at Motilal Oswal Financial Services . Agencies Of the stocks trading above 200- DMA, 62 are trading 10-20% away from the average price and 15 are at a 20-30% distance, while 138 are as much as 10% away. 11 stocks are trading 30% above their 200-DMA, according to Axis. Similarly, 162 stocks are up to 10% below the 200- DMA, 69 are 10-20% below the level, and 25 are over 20% away. In bullish conditions, fewer than 50% of the top 500 stocks below the 200-DMA would not be a reason to celebrate, but given the lingering concerns over the economic fallout of tariffs and uncertainty over corporate earnings, optimists would consider this number acceptable. 'Despite the muted fourth quarter earnings, a greater number of stocks out of the NSE 500 universe are trading above the 200-DMA compared to February and March, indicating investor confidence is returning on the street,' said Rajesh Palviya, head of technical and derivatives, Axis Securities. The Nifty 500 Index slumped by nearly 8% in February but bounced back in March and April, gaining 7.3% and 3.2%, respectively. The Nifty Midcap 150 and Smallcap 250 indices have risen 17.6% and 20.2%, respectively, from their lows this year on February 28 and March 3. 'Mid-caps moved up when domestic investors bought, and large-cap names performed well when foreign investors began purchasing after a period of aggressive sell-off, so there has been rotation among the stocks,' said Jain.
