Nifty's 4% YoY Q1 PAT growth surpasses Motilal's estimates. Adani Ports and four others see FY25 earnings upgrades
Nifty delivered a 4% year-on-year (YoY) growth in profit after tax (PAT), surpassing Motilal Oswal's estimate of 3%. This is the slowest growth since the pandemic quarter of 2020. Nifty heavyweights HDFC Bank, Tata Motors, ICICI Bank, Maruti Suzuki, and Tata Consultancy Services (TCS) contributed 127% of the incremental year-on-year earnings growth. In contrast, Bharat Petroleum Corporation (BPCL), JSW Steel, ONGC, Reliance Industries (RIL), and Grasim Industries had a negative impact on Nifty earnings, according to a preview note by the brokerage.
State-run Coal India, Dr Reddy's Laboratories, Apollo Hospital, Adani Ports & Special Economic Zone (APSEZ), and Tata Steel have received earnings upgrades from Motilal Oswal. In contrast, BPCL, Bharti Airtel, Hero MotoCorp, JSW Steel, and IndusInd Bank are the top five earnings downgrades.
Of the 24 sectors of Motilal Oswal, 7 reported earnings above estimates, 11 were in line, and 6 fell below estimates. Out of the 263 companies covered, 77 exceeded profit estimates, 113 missed them, and 73 were in line.
Sectoral Highlights:
1) Banks: The banking sector reported a soft quarter due to tepid business growth, moderated Net Interest Margins (NIM), and a slight increase in provisioning expenses, particularly for private banks. Most banks experienced NIM contraction due to cost pressures, intense competition for liabilities, and continued pressure on the CASA mix. Public sector banks (PSBs) saw mild margin compression, but new investment guidelines led to better investment
