Rs

India Strategy

India Strategy | Earnings drought ending, finally!

July 2025

Strong

macros

Monetary

policy actions

Healthy

Earnings

Robust Domestic

Liquidity

Geopolitical

Tension

Trade Tariffs

Sluggish Global

Growth

Market

Volatility

The Crossover Quarter

Gautam Duggad

-

Research Analyst

(Gautam.Duggad@MotilalOswal.com)

Investors are advised to refer through important disclosures made at the last page of the Research Report.

1

Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.

April 2021

Content:

The CROSSOVER quarter!

01

Page #3

Summary

02

Page #9

Corporate earnings at a glance:

Defensives poised to aid earnings

growth

03

Page #12

Markets bounce back from the

1HCY25 lows

04

Page #16

1QFY26 PREVIEW: O&G to drive

earnings; Auto and Pvt. Banks to

drag

05

Page #29

MOFSL Universe: 1QFY26

Highlights & Ready Reckoner

06

Sector & Companies Preview

Page #45

AUTOMOBILES – Pg46

Margins likely to be

under pressure

CAPITAL GOODS – Pg63

Comfortably placed

CEMENT – Pg75

Robust performance

supported by a low base

Chemicals – Pg86

Volume-driven growth

anticipated; pricing

pressure persists

CONSUMER – Pg99

Steady overall demand

with Jewelry outlier; soft

margins

CON. DURABLE – Pg132

Cooling products lag;

cables continue to lead

EMS – Pg137

Demand tailwinds

continue to drive growth

FIN. BANKS – Pg143

Margin pressure to weigh

on earnings

NBFC – Pg164

Demand trends soft;

seasonal weakness

visible in asset quality

NON LENDING – Pg181

Strong recovery for

capital market; steady

trend for insurance

HEALTHCARE – Pg198

Pharma growth

moderates

INFRA – Pg217

Execution to be muted in

1Q; tender pipeline

remains robust

LOGISTICS – Pg221

Gradual recovery in

logistics activity amid

cost pressures

METALS – Pg227

High steel prices with

muted cost to drive

earnings; non-ferrous

earnings to soften over

muted volume and prices

OIL & GAS – Pg239

OMCs/CGDs weather

commodity storm!

REAL ESTATE – Pg253

Robust sales driven by

stable demand

RETAIL – Pg264

Demand trends weak;

low base supports

growth

TECHNOLOGY - Pg276

Indian IT's stop-start

recovery

TELECOM - Pg287

Likely a steady quarter;

next tariff hike key

monitorable

UTILITIES - Pg298

Soft quarter as power

demand slows

India Strategy

BSE Sensex: 83,433

Nifty 50: 25,461

India Strategy | 1QFY26

quarter!

The CROSSOVER

Preview

Mastering the game!

The

CROSSOVER

quarter!

As we step into the 1QFY26 earnings season, the first six months of 2025 have proven

to be one of the most eventful periods, characterized by heightened geopolitical

tensions and international economic hostilities, culminating into both kinetic and non-

kinetic wars. This spawned not just heightened market volatility (S&P 500 VIX touching

50%+ and India VIX touching 20%+) but also a high level of economic uncertainty and

ambivalent signals for monetary policymakers, adversely affecting corporate earnings

visibility. Despite such an adverse backdrop for equities, the global equity markets,

including India, have shown impressive resilience in 2025, with Korea (+25% in 6M),

China (+20%), Germany (+19%), and Brazil (+19%) leading the way, while India has also

recouped 6%

since Jan’25.

Markets near an all-time high;

largecaps outperform in CY25YTD

Nifty-50

Nifty Midcap-100

Nifty Smallcap-100

17

Markets seeing beyond the haze; India stays an oasis of relative stability

Investors have chosen to look beyond the near-term geopolitical haze and focus more

on long-term market cycles. While the Indian equity market has underperformed EM

in CYTD25, it has still risen by 6% during the year, despite facing its own geopolitical

challenges and a full-scale kinetic war. Amidst the pall of geopolitical gloom, the Indian

economy is standing out for its relative economic stability, with several macro

parameters turning favorable and corporate earnings expected to be on a

progressively improving cycle going forward. We expect MOFSL/Nifty to post full-year

PAT growth of 14%/11% in FY26 compared to 4%/5% in FY25.

31 31

8

4

2

-3 -2 -2

YTD change Change 3-yr CAGR

(%)

from 2024

(%)

highs (%)

Government and policymakers doing ‘whatever it takes’

A key standout feature in 1HCY25 has been the policymakers’ and government’s swift

response to address economic challenges. The Reserve Bank of India (RBI) has

adopted a highly accommodative stance, implementing an unexpected 100bp cut in

the repo rate during CY25TD and a cumulative staggered reduction of 150bp in the

Cash Reserve Ratio (CRR). This has been complemented by injecting liquidity into both

the money and foreign exchange markets through multiple rounds of Open Market

Operations (OMOs) and foreign exchange swaps, along with regulatory support by

rolling back restrictions on various lenders. The government had also foregone INR1tn

of personal income tax in the FY26 Union budget and has undertaken few confidence-

building measures. The government has also received a record INR2.7tn in RBI

dividend, which will find its way through the course of the year. Moreover, after a

prolonged uncharacteristic slack in capex in 9MFY25, the government has again

embarked on big capital spends

(INR 2.4t in Mar’25 was a record), with the past five

months' (Jan-May’25)

capital spending

growing at 41% YoY vs. 2% YoY in 9MFY25.

Macros improving; contained inflation, bountiful monsoon hold promise

Abhishek Saraf

Abhishek.Saraf@MotilalOswal.com

Deven Mistry

Deven@MotilalOswal.com

Anshul Agarawal

Aanshul.Agarawal@MotilalOswal.com

Various macro parameters have started to exhibit signs of improvement. Most

strikingly, inflationary impulses have been effectively managed, with the latest CPI print

reading at 2.8% and WPI print at 0.4%, despite potentially inflation-stoking

developments such as the tariff war, ongoing conflict in the Middle East, and the

Russia-Ukraine war. The real GDP growth for 4QFY25 surprised materially on the

upside (7.4% YoY), while FY26 real GDP growth expectations stand at 6.4% and nominal

3

July 2025

The CROSSOVER quarter!

Mastering the game!

MOFSL Universe to clock ~10%

earnings growth in 1QFY26E

PAT growth YoY (%)

9.4

9.5

6.4

GDP growth at 10.5% YoY. Monsoon rainfall to date has been bountiful (10% above

LPA) and reasonably well distributed both temporally and geographically. This holds

promise for a strong Kharif output and is likely to further bolster rural sentiment,

where rural spending has already grown impressively at an 11-quarter high of 6.6% in

4QFY25. Conversely, urban consumption should witness a boost, as the effects of

personal income tax forbearance begin to materialize, with households anticipated to

adjust their spending budgets to account for tax savings over the next few quarters.

Domestic systemic liquidity, which experienced a deficit in 2024, has returned to

surplus, prompting the RBI to intervene and absorb some excess short-term liquidity

through the Variable Rate Reverse Repo (VRRR) window.

Domestic equity flows remain a key pillar of strength; FIIs return

-0.9

Sep-24

Dec-24 Mar-25 Jun-25E

The flows into Indian equity mutual funds have continued unabated despite all the

worries of the past five months, serving as a cornerstone of the Indian equity markets.

For 1HCY25, DII inflows have reached USD42b, as retail investors have maintained their

confidence in Indian equities. In addition, the FII flows, which had turned sharply

negative in the first few months of CY25 due to the then strength of USD and

expectations of US economic resilience, have also reversed course. This shift comes

amid an altered perception over the sustainability of US dollar as reserve currency and

the weakness of US economy, following the announcement of reciprocal tariffs. While

FII flows for the year still stand at a negative USD8.2b, the past three months (Apr-

Jun’25) have witnessed successive inflows of ~USD5.4b –

indicating foreign investors'

renewed faith in Indian equities.

First quarter likely to be ‘The Crossover’ quarter for earnings

We perceive 1QFY26 as the “Crossover quarter,” which

should mark the

crossing-over

from a subdued low-single-digit earnings growth of FY25 towards a more sustainable

double-digit earnings growth over the four subsequent quarters. Bottom-up aggregates

of our analyst estimates suggest a 10%/5% YoY growth in 1QFY26 MOFSL/Nifty earnings.

For the remainder of FY26, the bottom-up aggregate of our analyst estimates suggests a

12%/15%/14% YoY growth in 2Q/3Q/4Q FY26 PAT of MOFSL universe and 6%/13%/16%

YoY growth in NIFTY PAT. Even excluding commodities, MOFSL/Nifty earnings are

expected to grow at a much better cadence of 9%/15%/18% and 5%/11%/16%.

Sectoral breadth for earnings in 1QFY26 looks promising

The expectation of a 10% YoY growth in MOFSL 1QFY26 earnings is skewed by a sharp

42% YoY growth in the O&G sector, and excluding global commodities, the growth rate

will still be a modest 6%. However, the key highlight of the quarter is anticipated to be

the better sectoral breadth of earnings growth. Multiple sectors are expected to post

double digit PAT growth in 1QFY26 viz. Cap Goods (+12%), Cement (+35%), Chemicals

(+10%), EMS (+46%), Logistics(+20%), Healthcare (+11%), Real Estate (+40%), Retail

(+23%), Staffing (+11%), Telecom (Loss to Profit), Utilities (+12%). Lesser sectors are

likely to experience muted earnings growth or even a decline in earnings. These sectors

include: Technology (+7%), Consumer (+3%), BFSI (+3%), Metals (-4%), Autos (-10%).

Number of Sectors likely to post negative growth is expected to be lower at 2 (Autos

and Metals) in 1QFY26 vs. 6 sectors in FY25

–

indicating improving dispersion of

growth. Interestingly, for full year FY26 we currently do not factor in any sector to post

negative PAT growth.

July 2025

4

The CROSSOVER quarter!

Mastering the game!

Stage set for a healthy economy and market performance in 2HFY26



We believe that all the previously mentioned stimulative monetary, fiscal, and

regulatory accommodations should begin to yield significant results starting

2HFY26. This is anticipated to result in improved economic expansion and

corporate earnings growth, benefiting from a benign base of 4%/5% FY25 PAT

growth for MOFSL/Nifty. While Indian equity market has risen over the past few

months based on these expectations, it has still experienced both time and price

corrections from the highs reached in Sep’24.

Hence, we remain constructive

about Indian equities and view India as one of the unique markets that offers an

uncommon trifecta of size, growth, and diversification

–

a theme we have been

highlighting . While valuations have crept above long-term averages, with Nifty

currently trading at 21.7x 12-month forward

–

at a 5% premium to LPA, we do not

consider it to be in the overheated zone. We see potential for further market up-

move, especially in an environment of improving corporate earnings growth, low

interest rates, ample liquidity, and macroeconomic recovery. Our model portfolio

is tilted towards domestic names, driven by expectations of a domestic recovery.

While SMIDs trade at expensive valuations, we have picked select small- and mid-

cap high-conviction names in our portfolio.

Sectoral PAT growth for the

quarter-ended

Jun’25

(YoY %)

Telecom

EMS

Oil & Gas

Real Estate

Cement

Retail

Logistics

Media

Cap. Goods

Utilities

NBFC - Non Lending

Staffing

Healthcare

Chemicals

MOFSL Univ.

NBFC - Lending

Technology

Infra

Banks-PSU

Insurance

Cons. Durables

Consumer

Banks-PVT

Metals

Auto

Earnings highlights

–

1QFY26E | O&G to drive modest earnings growth



LP

46

42

40

35

23

20

17

12

12

11

11

11

10





10

8

7

5

5

4

4

3

-3

-4

-10









We expect the

MOFSL earnings to grow 10% YoY, while those of Nifty would

also grow by a modest 5% YoY in 1QFY26.

Excluding financials, the earnings are

expected to grow 14% YoY and 6% YoY, whereas, excluding global commodities

(i.e., Metals and O&G), the MOFSL Universe and Nifty are likely to report 6% and

4% YoY earnings growth, respectively, for the quarter.

The overall modest earnings growth is expected to be anchored by O&G (+42%

YoY), Telecom (loss-to-profit), Technology (+7%), NBFC-Lending (+8%), PSU Banks

(+5%), and Healthcare (+11%), which are likely to contribute 89% of the

incremental YoY accretion in earnings. Conversely, Automobiles (-10%), Metals (-

4%), and Private Banks (-3%) are likely to contribute adversely to earnings.

Sales and EBITDA of the MOFSL Universe are likely to grow 4% and 10% YoY,

while for the Nifty, we expect sales and EBITDA to improve 7% YoY and 6% YoY,

respectively. Ex-Commodities, EBITDA of the MOFSL Universe/Nifty is likely to

grow 7%/6% YoY.

The MOFSL

Financial

Universe is expected to post a muted 3% YoY earnings

growth, primarily due to weak performance by Private Banks and subdued growth

from PSU Banks. The

Pvt. Banks

sector is projected to report a second quarter of

earnings decline (of 3% YoY)

since Mar’20,

while the

PSU Banks

Universe is likely

to clock moderate earnings growth of 5%, the lowest in 20 quarters. The earnings

of

Insurance

Universe are expected to moderate to 4% YoY.

NBFC-lending

is likely

to post modest 8% YoY growth (sequentially higher), and

NBFC non-lending

is set

to record modest earnings growth of 11% YoY, the lowest in 10 quarters.

The

O&G

Universe earnings are expected to grow 42% YoY, fueled by OMCs.

The

Telecom

universe is likely to post the third quarter of profit of INR10b in

1QFY26 (vs. a loss of INR17b in 1QFY25 and a profit of INR5b in 4QFY25), mainly

led by continued improvement in margins in Bharti Airtel.

The

Capital Goods

sector is projected to report a healthy earnings growth of 12%

YoY, moderating from a high base of 28% YoY growth in 1QFY25, marking the

5

July 2025

The CROSSOVER quarter!

Mastering the game!

MOFSL large-mid-small-cap PAT

growth in 1QFY26 (YoY %)

21.5





9.5

8.4



0.3























second consecutive quarter of posting less than 15%+ earnings growth after seven

consecutive quarters.

The

Healthcare

universe is likely to report 11% YoY earnings growth, moderating

after posting eight quarters of 15%+ earnings growth.

The

Cement

universe is expected to report strong earnings growth of 35% YoY

in 1QFY26. The sector is likely to clock the first quarter of earnings growth after

four consecutive quarters of significant earnings decline.

After a modest performance in 4QFY25, the

Real Estate

universe is likely to

deliver a strong quarter with earnings surging 40% YoY.

The

Chemicals

sector is likely to report a 10% YoY earnings growth, the second

quarter of earnings growth after declining for seven consecutive quarters.

The

Technology

sector is likely to deliver modest earnings growth of 7% YoY in 1Q,

the lowest in five quarters, and marking the eighth quarter of single-digit growth.

The

Consumer

sector is expected to post weak earnings growth of 3% YoY,

following three consecutive quarters of earnings decline.

The

Auto

sector is likely to report a weak quarter with a 10% YoY earnings dip.

The

Metals

universe is projected to report a 4% YoY decline in profits after

reporting four quarters of earnings growth.

We expect the EBITDA margin (ex-Financials) to expand 140bp for the MOFSL

Universe to 18.2%. Conversely, for the Nifty-50, the margin is likely to remain

flat at 21.1% (ex-Financials) during the quarter.

In 1QFY26, the MOFSL large-cap/mid-cap universe is likely to register a PAT growth

of 8%/21%, while the small-cap universe earnings during the quarter are projected

to remain flat YoY. Moreover, sales for large-/mid-/small-caps are likely to grow 4%/

3%/3% YoY, and their EBITDA would clock 9%/19%/6% YoY growth for the quarter.

Sales/EBITDA/PAT of the MOFSL Universe

are likely to report a two-year CAGR of

6%/7%/6% over

Jun’23-Jun’25.

FY26E earnings highlights:

The MOFSL Universe is likely to deliver sales/EBITDA/

PAT growth of 5%/12%/14% YoY. The Financials, O&G, and Metals sectors are

anticipated to be the key earnings drivers with 8%, 18%, and 11% YoY growth in

FY26E, respectively. These three sectors are projected to contribute 52% of the

incremental earnings for the MOFSL Universe in FY26.

Nifty EPS cut for FY26E/27E:

We reduce our FY26E/FY27E Nifty EPS by 1.2%/

0.4% and expect it to grow 11%/17% YoY to INR1,122/INR1,308. The BFSI, Auto,

Consumer, Healthcare, Metals, and Retail sectors have led to the majority of the

earnings cut.

MOFSL TOP IDEAS: Large-caps

–

ICICI Bank, Bharti Airtel, L&T, Kotak Mahindra

Bank, M&M, Titan, BEL, Ultratech, Macrotech Indian Hotels, and Tech Mahindra;

Mid-caps and Small-caps

–

Dixon Tech, UTI AMC, Suzlon Energy, SRF, Jindal

Stainless, Coforge, Page Industries, Kaynes Tech, Niva Bupa, and Supreme

Industries.

Model portfolio: Key changes

Our model portfolio broadly reflects our preference for growth visibility and

domestically focused plays in a challenging global environment. As we anticipate a

gradual recovery in earnings by FY26, we marginally raise our weights in mid- and

small-cap stocks. We discuss the key changes in our model portfolio below:

July 2025

6

The CROSSOVER quarter!

Mastering the game!















We are OW on BFSI, Industrials, & Healthcare, while we are UW on Oil & Gas,

Cement, and Metals. We upgrade Automobiles from UW to Neutral. We have

also made several additions from a bottom-up standpoint across sectors.

FINANCIALS:

We retain our OW stance on BFSI and have raised allocation to ICICI

Bank further by trimming 100bp from Kotak Mahindra Bank. After a very strong

outperformance since our upgrade in Dec’24, we have recently downgraded BSE

from BUY to Neutral and replaced BSE with UTI AMC in the model portfolio.

We

expect UTI AMC to report AUM/revenue/core PAT CAGR of 17%/13%/20% over

FY25-27. Sustained strong performance has been a key re-rating driver for AMC

stocks. UTI AMC’s discount to other players has widened over the past few

months.

We are also incorporating Niva Bupa into the model portfolio.

We prefer

Niva Bupa due to its strong growth, diversified distribution and product mix, and

strong management team.

TECHNOLOGY:

We maintain our Neutral stance on IT. We add further weights to

Mid-Cap IT by replacing TCS with Hexaware. We are adding Hexaware to the

model portfolio as its focus on high-value, scalable clients, as well as its

execution through its “Land, Ramp, and Expand” client mining strategy, has

driven steady revenue growth. With ~21% EPS CAGR over CY24–26, HEXT sits in

the top growth quadrant among mid-cap peers

–

its strength in client mining

and improving margin profile offer compelling risk-reward.

CONSUMPTION:

We continue to remain OW on Discretionary and UW on

Staples. We are further reducing our weights in Staples by replacing HUL with

Radico Khaitan.

We believe that Radico will deliver strong earnings growth

over the next 3-5 years, considering the opportunity it has to scale up its P&A

portfolio in the industry.

Over FY25-28, we expect Radico to deliver a 16%

revenue CAGR, fueled by strong growth in the P&A segment. Overall volume

growth is projected at 9%, driven by a robust 15% CAGR in the P&A portfolio.

Additionally, the EBITDA margin is expected to improve from 13.9% in FY25 to

16.2% in FY28E (similar to FY19), supported by premiumization. We model an

EBITDA and APAT CAGR of 22% and 30% over FY25-28E, respectively. We are

also replacing Trent with Jubilant Foodworks.

JUBI’s focus on customer

acquisition and driving order frequency has led to strong delivery growth. Value

offerings and product innovation will continue to drive order growth in FY26.

We model a recovery in operating margin for the India business to 13.5% in

FY27 from 11.9% in FY25, after witnessing a 300bp dip in EBITDA margin (pre-

IND AS) during the last two years.

AUTOMOBILES:

We upgrade Automobiles from UW to Neutral by adding 100bp

each to our existing positions in M&M and TVS Motors.

INDUSTRIALS:

This sector remains our favorite theme, and we maintain our OW

stance and weights in the sector with allocation towards L&T, Dixon

Technologies, and Kaynes. We replace ABB with Bharat Electronics. We are

adding BEL to our model portfolio, as we anticipate it will continue to benefit

from the increase in defense spending in India, along with the emergency

procurement pipeline being developed by the Ministry of Defence (MoD). We

expect valuations to remain expensive due to the opening up of export markets

for larger platforms and increased TAM for the domestic market.

HEALTHCARE:

We retain our OW stance on Healthcare and maintain our

weights in Sun Pharma, Global Health, and Dr. Agarwal’s Health.

7

July 2025

The CROSSOVER quarter!

Mastering the game!



METALS:

We are replacing Tata Steel with Jindal Stainless.

We are adding

Jindal Stainless to the model portfolio because of capacity additions

through organic and

inorganic

routes, market leadership position,

increasing share of high-margin value-added products, and cost-saving

initiatives (JV for supply of Nickel, captive power, etc.).





REAL ESTATE: We are adding Macrotech back to the model portfolio.

LODHA

has delivered steady performance across its key parameters, and as it prepares

to capitalize on strong growth and consolidation opportunities, we expect this

consistency in operational performance to continue.

PIPES:

We are also introducing Supreme Industries to our model portfolio.

Higher government spending, SI’s capacity expansion, and market share gains

from unorganized players are expected to drive growth for Supreme. EBITDA

margin is likely to expand due to rising EBIT/kg and increasing share of value-

added products, leading to a 14%/20%/23% CAGR in revenue/ EBITDA/Adj. PAT

over FY25-28.

Note: Exhibit data is sourced from Bloomberg, Companies, and MOFSL research database

July 2025

8

Corporate earnings at a glance: Defensives poised to aid earnings growth

The CROSSOVER quarter!

Mastering the game!

O&G would lead the charge; excluding Financials, profits would grow 14% YoY and 6% YoY for the MOFSL Universe and

Nifty, respectively.

BFSI and Auto would continue to lead, while contributions from Healthcare and Cement to improve

PAT expected to grow 10% YoY for

PAT likely to rise 14% YoY for the

PAT to grow 6% YoY for the MOFSL

the MOFSL Universe

MOFSL Universe, excluding Financials

Universe, sans Metals and O&G

MOFSL Universe

55

37

29

15

1

6

20

10

2

-1

6

9

10

-10

-22

5

MOFSL Ex Financials

47

52

32

MOFSL Ex Metals and O&G

58

36

37

23 23

18

6

5

11

14

4

32 32

14

-5

11 10

9

-9

6

PAT growth for the Nifty Universe

likely to be only 5% YoY

32

Nifty Universe

PAT to grow 6% YoY for the Nifty

(ex-Financials)

31

Nifty Ex Financials

PAT to grow 4% YoY for the Nifty

(ex-Metals and O&G)

Nifty Ex Metals and O&G

51

22 23

19

12 12

14

14

8

7

8

5

3

22

20

24

10

6

3

3

35

32 30

24

17 17

12 10

8

5

1 0

4

7

6

3

4

Performance of the MOFSL Universe to be driven by O&G and Telecom and weighed down by Automobiles, Metals, and

Private Banks in 1QFY26

12

17 13 12

11

8

7

6

5

4

4

3

2

1

1

0

0

0

11

157 27

20

17

12

24

2,939

3,220

July 2025

9

Corporate earnings at a glance:

O&G’s PAT contribution to rise

The CROSSOVER quarter!

sequentially

Mastering the game!

O&G’s

PAT contribution to the MOFSL Universe shows some signs of sequential

increase in 1QFY26

O&G PAT (INRb)

22.0

18.6

15.0

13.2

13.1

16.1

15.7

12.6

12.9

13.6

13.6

16.4

O&G contribution to MOFSL universe PAT (%)

21.6

While continuing to decline from the highs of 40% in Sep’24,

Financials to maintain over one-third share of total profits

BFSI PAT (INRb)

41

38

30

35

34

35

36

38

BFSI contribution to MOFSL universe PAT (%)

39

40

38

37

36

MOFSL (ex-OMC)’s

PAT share (%):

Defensives to drive the 1QFY26 earnings

32

54

23

-1

28

29

24

36

28

24

33

25

33

24

33

24

34

25

20

DEFENSIVES

22

24

22

24

22

23

22

23

22

24

21

22

23

22

23

21

24

21

22

24

21

21

35

GLOBAL CYCLICALS

47

45

43

40

36

43

42

43

42

DOMESTIC CYCLICALS

55

54

55

54

55

54

58

55

56

55

57

55

July 2025

10

The CROSSOVER quarter!

Mastering the game!

MOFSL: MODEL PORTFOLIO

SECTOR WEIGHT /

PORTFOLIO PICKS

Financials

Private Banks

ICICI Bank

HDFC Bank

Kotak Mahindra Bank

PSU Bank

SBI

Diversified Financials

Angel One

Shriram Finance

UTI AMC

Cap Goods, Infra & Cement

Larsen & Toubro

Bharat Electronics

Dixon Tech.

UltraTech Cement

Kaynes Technology

Consumption / Retail

Titan Company

Radico Khaitan

Jubilant Foodworks

Indian Hotels

Page Industries

Technology

Hexaware Tech.

HCL Tech

Tech Mahindra

Coforge

Energy/Telecom

Reliance Industries

Bharti Airtel

Auto

Mahindra & Mahindra

TVS Motor

Metals / Utilities

Power Grid Corp.

Jindal Stainless

Suzlon Energy

Healthcare

Sun Pharma

Global Health

Dr Agarwals Health.

Others

SRF

Supreme Inds.

Macrotech Developers

Niva Bupa Health

TOTAL

LP: Loss to Profit

BSE 100

34.1

23.7

7.2

10.6

2.2

3.0

2.2

7.4

0.0

0.7

0.0

9.1

2.9

1.1

0.4

1.0

0.0

12.4

1.1

0.0

0.0

0.5

0.0

10.7

0.0

1.3

0.7

0.5

13.2

7.2

3.7

6.7

2.0

0.5

7.1

0.9

0.0

0.5

4.6

1.2

0.0

0.0

2.0

0.3

0.0

0.0

0.0

100

MOFSL

WEIGHT

35.0

23.0

10.0

9.0

4.0

4.0

4.0

8.0

3.0

3.0

2.0

12.0

4.0

2.0

2.0

2.0

2.0

11.0

3.0

2.0

2.0

2.0

2.0

10.0

2.0

3.0

3.0

2.0

9.0

5.0

4.0

7.0

4.0

3.0

6.0

2.0

2.0

2.0

6.0

2.0

2.0

2.0

4.0

1.0

1.0

1.0

1.0

100

WEIGHT

RELATIVE TO

BSE100

0.9

-0.7

2.8

-1.6

1.8

1.0

1.8

0.6

3.0

2.3

2.0

2.9

1.1

0.9

1.6

1.0

2.0

-1.4

1.9

2.0

2.0

1.5

2.0

-0.7

2.0

1.7

2.3

1.5

-4.2

-2.2

0.3

0.3

2.0

2.5

-1.1

1.1

2.0

1.5

1.4

0.8

2.0

2.0

2.0

0.7

1.0

1.0

1.0

EFFECTIVE

SECTOR

STANCE

Neutral

Neutral

Buy

Buy

Buy

Neutral

Buy

Neutral

Buy

Buy

Buy

Overweight

Buy

Buy

Buy

Buy

Buy

Underweight

Buy

Buy

Neutral

Buy

Buy

Neutral

Buy

Buy

Buy

Buy

Underweight

Buy

Buy

Neutral

Buy

Neutral

Underweight

Buy

Buy

Buy

Overweight

Buy

Buy

Buy

Overweight

Buy

Buy

Buy

Buy

PAT YoY / CAGR (%)

FY25

FY26E

FY27E

FY25-FY27

16

11

20

16

4

15

1

13

32

92

-13

60

8

35

-10

33

28

18

11

17

17

0

55

11

30

0

-4

106

13

11

0

-3

-13

70

161

12

7

8

-1

2

-26

16

7

21

14

44

47

84

27

42

72

16

15

27

9

28

65

16

59

20

17

14

19

55

14

13

44

48

9

32

-44

13

20

17

19

15

61

19

18

19

21

43

25

57

18

29

50

23

17

18

9

27

23

11

39

12

18

5

23

40

17

39

34

40

13

6

120

17

13

13

9

8

9

18

12

20

17

44

36

70

22

35

61

19

16

23

9

28

43

14

49

16

18

9

21

47

16

26

39

44

10

18

11

15

July 2025

11

The CROSSOVER quarter!

Mastering the game!

MARKETS

Nifty-50: Indian markets continued

to record gains

YoY return (%)

29

24

20

15

12

9 8

3

3

4

Markets bounce back from the 1HCY25 lows…

…fueled

by robust DII inflows and improving FII sentiments amid easing

geopolitical turbulence





Nifty Midcap-100 turned green and

posted modest gains

Nifty Midcap 100

YoY return (%)



47

24

47

46

22

6 7

4

-4

-15

4



Nifty Smallcap-100 also posted

marginal gains in CY25YTD

Nifty Smallcap 100

YoY return (%)

57

59

21

56

24

2

7 2

-10

-29

-14

Sustain uptrend after a volatile period…:

The Indian market bounced back

sharply after a period of heightened geopolitical tension in 2QCY25 and lingering

uncertainties around US trade tariffs. Despite the uncertainties around

geopolitical conflicts, volatile FII flows, and news flow around US trade tariff

announcements, Indian equities saw a steady recovery. The Nifty-50 gained 16%

from its

Mar’25 lows,

rising 8% in CY25YTD. By Jun’25,

the market recovered to

Sep’24 levels,

reaching just 3% below its all-time high. It has clocked a CAGR of

6%/17%/20%/12% over the 1-yr/3-yr/5-yr/10-yr periods.

…but

underperform global peers:

Despite this strong rebound, India

underperformed several major global markets in CY25YTD, many of which saw

sharper recoveries from a low CY24 base. South Korea (+69%), Germany (+36%),

Russia (+32%), Brazil (+31%), France (+18%), the UK (+17%), MSCI EM (+14%),

Japan (+11%), and Taiwan (+8%)

all outpaced India’s

(+8%) gain during the period.

In contrast, the US and China lagged, each posting 5% growth in CY25YTD.

Mid- and small-cap outperformance narrows:

After a strong rally between

Apr’23

and

Sep’24,

mid- and small-cap outperformance has continued to narrow

over the past nine months. The Nifty Midcap-100 and Smallcap-100 indices fell

21% and 25% from their all-time highs, while the Nifty-50 declined 16% by

Mar’25.

However, they later recovered 25% and 30%, respectively, with the

Nifty-50 rising 16% from their respective lows, resulting in marginal negative

returns of 2–3% for all three indices over the past one year. Moderating

earnings and valuation concerns triggered a sharp sell-off, especially in small-

cap stocks. In contrast, mid-caps posted relatively better earnings performance,

leading to some cooling off in their valuations. However, valuations remain

stretched in small-caps, rich in mid-caps, and above average in large-caps.

DII flows hit record highs; FII flows remain positive in 2QCY25:

DII inflows

continue to remain strong, driven by resilient monthly SIP flows of ~USD3b and

increasing retail participation. DII inflows of USD 41.5 billion in the first six

months of CY25 have already reached 66% of the total inflows recorded in the

entire CY24. Meanwhile, easing geopolitical concerns, progress on resolving

Trump’s aggressive reciprocal tariffs, and expectations of interest rate

cuts in

the latter half of CY25 have helped stabilize FII flows, resulting in three

consecutive months of net

inflows for the first time since Oct’24.

While retail

participation and DII flow momentum are likely to remain strong, geopolitical

developments and a recovery in domestic earnings will be the key factors

influencing FII flows into Indian markets. The limited impact of tariffs and

ongoing resolutions around them could further strengthen FII flows going

forward.

July 2025

12

The CROSSOVER quarter!

Mastering the game!

Exhibit 1:

Indices rebounded from the Mar’25 lows with the Nifty-50/Nifty Midcap-100/Nifty Smallcap-100 gaining 6%/7%/4% YoY

26,216

25,000

23,000

24,011

21,000

19,000

Nifty-50

Nifty Midcap-100

Nifty Smallcap-100

(rebased to Nifty-50)

25,736

25,582

25,003

Exhibit 2:

Performance of global equity indices in USD terms (%): India underperformed global peers in CY25YTD

CY25YTD change (%)

39

36

32

31

18

17

14

11

8

8

5

5

Exhibit 3:

Over the last 12 months, while the global market cap has jumped 13.4% (USD15.9t),

India’s market cap has

risen only

8% to USD5.4t

3.1

28

10.8

27

64.7

7.1

3.6

2.1

5.4

2.7

0.8

0.7

Mkt cap chg 12M (%)

Curr Mcap (USD Tr)

13

12

12

11

8

8

6

1

Germany

China

US

Japan

UK

Korea

India

Taiwan

Brazil

Indonesia

Exhibit 4:

Trend in India’s contribution to the global market cap (%) – moderates from a Sep’24 high but recovers from

the

Feb’25 low

5.5

4.5

3.5

2.5

1.5

India's Contribution to World Mcap (%)

4.6

4.0

3.6

Average: 2.8%

1.6

July 2025

13

The CROSSOVER quarter!

Mastering the game!

Exhibit 5:

FII flows continue to remain volatile…

FII (USD b)

23.4

14.2

3.8

15.9

-4.6

-17.0

21.4

32.2

22.3

6.0

-8.2

-5.0

12.1

Exhibit 6:

…while

DII inflows continue to hit record highs

DII (USD b)

62.9

41.5

-0.8

Exhibit 7:

FII flows have increased in the past three months

6.7

4.1

1.7

7.0

2.3

4.0

0.5

FII (USD b)

5.9

3.13.3

1.4

1.3

2.4

1.31.7

0.2

Exhibit 8:

DII flows have been robust for the last 23 months

DII (USD b)

12.8

10.0

-2.3

-2.7

-3.1

-1.1

-3.0

-2.2

-5.4

-8.4

-10.9

8.5

7.4

7.9

6.8 6.7

5.8

5.3

5.3

4.3

4.0

3.8

3.42.8

3.4

3.3

3.23.1

3.0

2.4 1.71.6

0.5

-0.3

Valuations of Nifty-50 above LPA, while those of broader markets remain

elevated





Nifty is trading at a 12-month forward P/E of 21.7x, 5% above its own LPA. We

expect FY26/FY27 EPS to grow 11%/17% to INR1,122/INR1,308.

India’s market cap-to-GDP

ratio has been volatile, dropping to 57% (of FY20

GDP) in Mar’20 from 80% in FY19. Since then, it has

remained above the long-

term average of 85%, reaching a multi-year

high of 146% in Sep’24. Following

the market correction and subsequent recovery, the ratio now stands at 127%.

We expect nominal GDP to grow 10.5% YoY in FY26 vs. 9.8% growth in FY25.

Exhibit 9:

Nifty-50 near the

Sep’24 high,

up 8% in CY25YTD; it is trading 5% above its LPA

29,000

23,000

17,000

Jun'15-25:

Nifty CAGR: 11.8%

Avg P/E: 20.7x

20.6

29.0

Nifty Index

Nifty P/E (x)

25,517

25.0

21.7

21.0

11,000

5,000

8,369

15.8

17.0

13.0

July 2025

14

The CROSSOVER quarter!

Mastering the game!

Exhibit 10: 12-month forward Nifty P/B (x)

3.8

3.3

2.8

10 Year Avg: 2.8x

2.3

1.8

Exhibit 11: 12-month forward Nifty RoE (%)

16.0

3.2

14.8

13.5

12.3

11.0

15.0

10 Year Avg: 13.8%

13.5

Exhibit 12:

The valuation gap between Nifty-50 and broader markets remains elevated

40

Jun’15-Jun’25

P/E(x)

Nifty-50 avg : 20.7x

Nifty Mid-cap-100 avg : 22.8x

Nifty Smallcap-100 avg : 16.4x

Nifty-50 P/E (x)

Nifty Midcap-100 P/E(x)

32

24

16

8

Nifty-50 trade at a premium

27.9

27.7

21.7

Nifty Mid-cap 100 and Nifty Small-cap 100 trade at a

premium to Nifty-50

Exhibit 13:

India’s market cap-to-GDP

ratio dips from the 17-year high levels of 146% in FY25, and stands at 127% in FY26YTD

GFC: Peak of 149% in Dec’07

Nominal GDP growth in

FY25/FY26E: 9.8%/10.5%

129 126 127

97

105

84 84

56

Average of 87% for the period

97

90

71

64 66

103

79 84 80

57

113

82

69

July 2025

15

The CROSSOVER quarter!

Mastering the game!

1QFY26 PREVIEW

O&G to drive earnings; Auto and Pvt. Banks to drag

MOFSL (ex-Commodities) earnings anticipated to grow 6% YoY



Expect O&G,

Telecom, and PSBs

to lead the

incremental profit

growth in 1QFY26





Of the 18 major

sectors under

MOFSL Coverage,

only 11 sectors are

likely to witness an

expansion in

EBITDA margin YoY







The

Auto

OEMs within our coverage universe are expected to deliver just 2%

YoY volume growth in 1QFY26. Within the listed peers, while 2Ws/PV OEMs

have posted 1% growth each, CVs are down 2% YoY for 1QFY26. For our OEM

coverage universe, while revenue is likely to be flat YoY, we expect EBITDA/PAT

to decline 14%/12% YoY in 1QFY26. The bulk of this decline is largely on account

of an expected sharp margin pressure at Tata Motors, especially at JLR, given

the ongoing global headwinds. Ex-TTMT, we expect EBITDA/PAT for our

coverage universe to decline 1%/3% YoY. Our Auto Ancillaries universe would

post ~6% growth in revenue, flat EBITDA, and a dip of 3% YoY in PAT in 1QFY26.

BFSI:

We expect a 3% YoY adj. earnings growth for our BFSI universe, which will

be driven by modest growth of PSBs (+5%) and NBFC lending (+8%). Insurance

(+4%) and NBFC Non-lending (+10%) are also likely to post moderate growth.

Private Banks (-3%) would drag the quarter's earnings. NII for our banking

coverage universe to report a muted growth at 1.7% YoY (down 0.6% QoQ). For

the private banks under our coverage, we estimate PPoP to grow 4.2% YoY/

3.8% QoQ. PSU banks to report a modest PAT growth of 4.8% YoY amid a decline

in NIMs, normalized opex, and higher provisions QoQ.

NBFCs:

We estimate ~14%/13%/8% YoY growth in NII/PPoP/PAT in 1QFY26 for

our NBFC coverage universe. Excluding NBFC-MFI, we estimate ~12% YoY

growth in PAT for our coverage universe. We expect ~10% YoY growth in AUM

for our coverage HFCs, including both affordable and large HFCs. Vehicle

financers are projected to report ~18% YoY AUM growth. Gold lenders (despite

the weakness in MFI growth) are likely to record ~29% YoY growth (primarily

driven by ~43% YoY growth in MUTH).

NBFC Non-lending:

The non-lending financial industry witnessed a strong

recovery across segments in 1QFY26. Positive market sentiment boosted activity

in the cash segment and AUM growth for AMCs/wealth managers/distributors.

Wealth managers are expected to deliver steady inflows and recurring revenue.

For life insurers, premium growth was subdued, though we expect an

improvement in profitability. General insurers witnessed a marginal recovery in

underlying demand, but they are expected to face elevated claims.

The

Technology

sector (IT services companies) is expected to report a modest

quarter, primarily due to a host of geopolitical events as well as tariff

uncertainty that would affect notable deal signings. Sequential revenue and deal

TCV across large-caps could be unexciting (expect QoQ CC growth range of -2.5%

to +1.5% for large-caps. Midcaps are expected to outperform once again with a

growth range of -2.0% to +7.0%). A weak dollar against a basket of currencies

will lead to 100-200bp of QoQ cross-currency tailwinds.

The

Capital Goods

sector’s

earnings are projected to rise 12% YoY (improving

sequentially vs. 7% growth in 4QFY25). Ordering momentum remained strong

during the quarter, supported by healthy traction across the defense, power

T&D, renewables, and B&F segments. The DAC has approved emergency

procurement worth INR400b for the Indian Defense Forces. We expect EPC

companies to report sequential recovery in margins. Export performance is

gradually improving for companies, with expectations of further gains. We will

wait to see a broad-based revival in domestic and private capex, along with

sustained momentum in order inflows, which would drive a re-rating of the

16

July 2025

The CROSSOVER quarter!

Mastering the game!

Sectoral sales growth for the quarter-

ended Jun’25

(YoY %)

EMS

Real Estate

Telecom

NBFC - Non Lending

Logistics

Cement

NBFC - Lending

Cap. Goods

Retail

Healthcare

Chemicals

Utilities

Insurance

Consumer

Technology

Cons. Durables

MOFSL Univ.

Banks-PVT

Metals

Media

Auto

Banks-PSU

Infra

Oil & Gas

Staffing

51

31

19

18

17

16

14

14

13

10

9

8

8

6

6

5

4

3

2

2

1

0

-1

-4

-4







Sectoral PAT growth for the quarter-

ended Jun’25

(YoY

%)

Telecom

EMS

Oil & Gas

Real Estate

Cement

Retail

Logistics

Media

Cap. Goods

Utilities

NBFC - Non Lending

Staffing

Healthcare

Chemicals

MOFSL Univ.

NBFC - Lending

Technology

Infra

Banks-PSU

Insurance

Cons. Durables

Consumer

Banks-PVT

Metals

Auto

LP

46

42

40

35

23

20

17

12

12

11

11

11

10

10

8

7

5

5

4

4

3

-3

-4

-10







sector from current levels. For 1QFY26, we estimate our coverage companies to

report revenue growth of 14% YoY, EBITDA growth of 14% YoY, and PAT growth

of 12% YoY.

For the MOFSL

Consumer

coverage universe, demand trends across various

categories continued to mirror recent historical quarters. Earnings growth for

our coverage universe is expected to record muted 3% YoY growth. Staple

companies are likely to experience sluggish urban demand and high-cost

inventory. We expect a marginal pickup in volume growth, with price hikes

supporting 1Q revenue growth. All segments are expected to deliver

revenue/EBITDA growth YoY in 1QFY26—staples +6%/+1%, paints & adhesives

+3%/+2%, liquor +11%/+6%, innerwear +12%/+21%, QSR +11%/+10%, and

jewelry +20%/+27%.

QSR

companies remained muted in 1QFY26.

Healthcare:

The Healthcare companies under our coverage are expected to

report a modest sales/EBITDA/PAT growth of 10%/7%/11% YoY in 1QFY26.

Moderation in the domestic formulation (DF) segment, led by weakness in the

acute segment and higher competition in select US generics products, is

expected to affect performance in 1QFY26. PAT is expected to grow at a higher

rate of 10% YoY. In the hospital space, we expect strong execution, supported

by bed additions, leading to 17% YoY revenue growth in 1QFY26.

The

Metal

companies within our coverage universe are likely to report a weak

quarter with a 4% YoY earnings decline. Sales/EBITDA for our coverage universe

is likely to grow 2%/6% YoY. We expect

ferrous

companies to report a volume

decline of 11% QoQ (+6% YoY). Muted coking coal costs (USD10-15/t) and

healthy NSR are likely to improve EBITDA/t by INR1,500/t during the quarter.

Non-ferrous

companies under our coverage are expected to post an aggregate

revenue and EBITDA decline of 8% and 18% QoQ, respectively, led by muted

volumes and sequential price corrections.

We estimate our

Cement

coverage universe to post 16%/38%/35% YoY growth

in revenue/EBITDA/PAT, led by higher cement prices and strong volume growth.

Aggregate cement volume is estimated to grow ~10% YoY to 92mt, aided by

inorganic growth. However, on a like-for-like basis, volume growth stood at ~4%

YoY in 1QFY26. Blended realization is expected to grow ~4% YoY/QoQ (each) to

INR5,565/t. We estimate EBITDA/t to rise ~29% YoY (~4% QoQ) to INR1,104.

We expect the

O&G

sector to report flat sales YoY (+7% YoY excluding OMCs), a

25% YoY rise in EBITDA (+5% YoY excluding OMCs), and a 42% YoY increase in

PAT (+9% YoY excluding OMCs) in 1QFY26.

OMCs:

Standalone EBITDA for

HPCL/BPCL/IOCL is expected to grow QoQ, driven by an improvement in

marketing margins on a sequential basis. SG GRM averaged USD5.7/bbl in 1Q

(vs. USD3.2/bbl in 4Q).

CGDs:

We estimate a 9%/6% YoY volume growth for

MAHGL/IGL and a 13% YoY volume decline for GUJGA.

Upstream:

For ONGC and

OINL, we expect oil & gas sales volumes to remain largely flat both QoQ and

YoY, while oil realizations are likely to see a sharp sequential decline for both

companies. We remain bearish on crude and maintain our Brent price forecast

of USD65/bbl for CY25/26.

The

Power Utility

companies under our coverage universe are anticipated to

report a revenue/EBITDA/adj. PAT growth of 8%/5%/12% YoY in 1QFY26. In Apr-

May’25, the country added 6.7GW of renewable capacity (largely solar) and

0.6GW of nuclear capacity, whereas thermal capacity fell by 6.9GW. While

17

July 2025

The CROSSOVER quarter!

Mastering the game!















current demand remains soft, peak demand months have shown great

variability historically, and demand could bounce back in the coming months.

Telecom:

We expect the Telecom sector to report a profit of INR10b in 1QFY26

(vs. a loss of INR17b in 1QFY25). We further project ~2-3% sequential growth in

combined wireless revenue/EBITDA for the three private telcos in 1QFY26. We

build in a 1.5% sequential uptick in the blended ARPU for the three private

telcos and the residual benefit of tariff hikes.

The

Real Estate

coverage universe is expected to report strong presales of

INR501b, up 59% YoY/51% QoQ, in 1QFY26. Volumes are expected to be 32msf,

up 26% YoY/35% QoQ. Collections for our coverage companies are likely to

increase 58% YoY to INR293b, implying a collection efficiency of ~58%. Revenue

recognition for our coverage is expected to stand at INR167b (up 31% YoY), with

EBITDA of INR50b (up 44% YoY) and a margin of 30%.

The

Chemicals

sector is projected to report a second consecutive quarter of

earnings growth of 10% YoY in 1QFY26 after seven consecutive quarters of

decline. The Brent crude price has remained benign at USD 68/bbl in 1QFY26. We

estimate our coverage universe to report a sales/EBITDA growth of 10%/5% YoY

during the quarter. Aggregate gross margin is likely to contract 40bp YoY, and

aggregate EBITDAM may expand 20bp YoY/30bp QoQ.

The 1QFY26 snapshot:

We expect EBITDA/PBT/PAT to rise 10%/5%/10% YoY in

1QFY26 for the MOFSL Universe. Excluding Metals and O&G, EBITDA/PBT/PAT

for the MOFSL Universe would grow 7%/flat/6% YoY.

The

EBITDA margins

for the Capital Goods, Cement, Consumer Durables,

Infrastructure, Logistics, Media, Metals, Oil & Gas, Real Estate, Technology and

Telecom sectors are likely to expand, while margins for Automobiles, Chemicals,

Consumer, EMS, Healthcare, Retail and Utilities are anticipated to contract on a

YoY basis.

Nifty earnings to grow 5% YoY in 1QFY26:

Ex-Commodities, the Nifty earnings

are anticipated to rise ~4% YoY. Reliance Inds. Bharti Airtel, JSW Steel, HDFC Bank,

and ICICI Bank are likely to drive Nifty earnings, while Coal India, Tata Motors,

IndusInd Bank, ONGC, and Maruti Suzuki are projected to drag the same.

The FY26E snapshot:

The MOFSL Universe and Nifty are likely to record 14% YoY

and 11% YoY earnings growth in FY26E, respectively. Excluding Metals and O&G,

the MOFSL Universe and Nifty should post a 12% and 10% YoY earnings growth,

respectively.

July 2025

18

The CROSSOVER quarter!

Mastering the game!

Exhibit 14:

MOFSL and Nifty Universe to post 10% and 5% YoY earnings growth, respectively, in 1QFY26 (INR b)

Sales

Sector

Jun-25

PAT growth sectors

10,065

Telecom (5)

761

EMS (7)

169

Oil & Gas (15)

7,480

Real Estate (13)

164

Cement (11)

658

Retail (22)

612

Logistics (8)

174

Media (3)

47

Med/Low growth sectors

10,189

Capital Goods (13)

982

Utilities (8)

841

Others (23)

738

NBFC - Non Lending (14)

75

Staffing (4)

109

Healthcare (26)

927

Chemicals (12)

178

NBFC - Lending (22)

465

Technology (13)

2,019

Infrastructure (3)

45

Banks-PSU (6)

883

Insurance (8)

1,774

Consumer Durables (5)

202

Consumer (21)

953

PAT de-growth sectors

7,017

Banks-Private (12)

928

Metals (11)

2,969

Automobiles (26)

3,120

MOFSL Universe (311)

27,271

MOFSL Ex OMCs (308)

23,586

MO Ex Metals and O&G (285) 16,822

MOFSL Ex. Financials

23,147

Nifty (48)

13,815

Sensex (30)

10,787

Growth (%)

YoY

QoQ

1

-5

19

2

51

-1

-4

-7

31

-8

16

-5

13

9

17

1

2

8

8

-8

14

-23

8

4

16

-7

18

8

-4

2

10

1

9

3

14

-1

6

0

-1

-8

0

-2

8

-24

5

-14

6

6

2

-6

3

0

2

-7

1

-7

4

-6

7

-6

8

-6

3

-5

7

-4

8

-3

EBITDA

Jun-25

1,769

385

9

1,069

50

112

65

68

10

2,559

117

285

127

39

3

220

32

377

450

13

615

42

20

222

1,660

697

577

386

5,989

5,645

4,342

4,220

3,624

2,956

Growth (%)

YoY

QoQ

26

5

27

1

47

-28

25

7

44

3

38

-4

12

11

22

3

8

45

7

-6

14

-41

5

8

14

-17

17

8

-19

0

7

1

5

1

13

-2

7

1

1

-12

2

-9

14

-46

5

-24

1

9

1

-5

4

3

6

-6

-11

-16

10

-3

7

-4

7

-5

12

-2

6

-3

9

-3

PAT

Jun-25

703

10

5

528

41

45

28

40

7

1,626

77

105

45

33

2

139

18

221

312

4

364

133

14

158

890

417

261

213

3,220

3,031

2,431

2,052

1,927

1,562

Growth (%) PAT Delta PAT

Delta

YoY

QoQ

INRb Share (%) Share (%)

46

9

222

22

79

LP

98

27

0

10

46

-29

1

0

1

42

11

157

16

56

40

3

12

1

4

35

-9

12

1

4

23

23

5

1

2

20

-1

7

1

2

17

31

1

0

0

7

-12

105

51

38

12

-44

8

2

3

12

-9

11

3

4

11

-31

4

1

2

11

11

3

1

1

11

0

0

0

0

11

1

13

4

5

10

3

2

1

1

8

-1

17

7

6

7

-1

20

10

7

5

-25

0

0

0

5

-12

17

11

6

4

-38

6

4

2

4

-24

0

0

0

3

11

4

5

1

-5

-11

-47

28

-17

-3

2

-11

13

-4

-4

-16

-12

8

-4

-10

-24

-24

7

-9

10

-8

280

100

100

5

-9

152

6

-10

135

14

-7

249

5

-5

92

9

-7

131

July 2025

19

The CROSSOVER quarter!

Mastering the game!

Exhibit 15:

Expect a two-year PBT/PAT CAGR of 5%/6% for the MOFSL Universe (INR b)

PBT (INR b)

Sector

Automobiles (26)

Capital Goods (13)

Cement (11)

Chemicals (12)

Consumer (21)

Consumer Durables (5)

EMS (7)

Financials (62)

Banks-Private (12)

Banks-PSU (6)

Insurance (8)

NBFC - Lending (22)

NBFC - Non Lending (14)

Healthcare (26)

Infrastructure (3)

Logistics (8)

Media (3)

Metals (11)

Oil & Gas (15)

Oil Ex OMCs (12)

Real Estate (13)

Retail (22)

Staffing (4)

Technology (13)

Telecom (5)

Utilities (8)

Others (23)

MOFSL Universe (311)

MOFSL Ex Metals and O&G (285)

MOFSL Ex OMCs (308)

Nifty (48)

Sensex (30)

Jun-23 Jun-24

254

82

61

26

201

14

3

1,264

484

431

93

230

25

129

7

34

8

330

870

466

21

29

2

366

1

114

57

3,873

2,674

3,469

2,357

1,825

324

98

46

22

207

19

4

1,501

567

480

150

266

39

181

7

40

8

389

526

446

37

30

2

397

21

126

48

4,032

3,118

3,953

2,555

2,016

Growth (%)

PAT (INR b)

Two-

Mar-25 Jun-25 YoY

year QoQ Jun-23 Jun-24 Mar-25 Jun-25

CAGR

369 285

-12

6

-23

187

237

281 213

191 113

14

17

-41

54

69

138

77

71

63

38

2

-11

44

33

50

45

23

23

7

-6

2

20

16

17

18

192 211

2

2

9

149

154

143 158

25

19

4

17

-23

10

14

18

14

12

7

58

57

-45

2

3

7

5

1,657 1,395

-7

5

-16

980

1,136 1,291 1,168

541 554

-2

7

2

363

427

410 417

547 494

3

7

-10

307

347

412 364

248

17

-88

-57

-93

113

127

214 133

284 286

8

12

1

177

204

224 221

37

43

10

31

15

20

30

30

33

178 183

1

19

3

99

126

138 139

8

6

-9

-7

-25

5

4

6

4

46

48

21

20

4

27

34

41

40

7

9

18

4

37

6

6

5

7

433 378

-3

7

-13

234

273

311 261

657 737

40

-8

12

631

371

476 528

466 486

9

2

4

326

311

324 339

47

47

28

52

2

18

29

40

41

31

37

22

12

20

22

22

22

28

2

2

7

12

-4

2

2

2

2

421 421

6

7

0

271

293

314 312

58

62

201

LP

8

-29

-17

5

10

160 138

9

10

-14

87

94

116 105

80

56

17

-1

-31

52

40

65

45

4,669 4,242

5

5

-9

2,871 2,939 3,485 3,220

3,579 3,127

0

8

-13 2,005 2,296 2,699 2,431

4,478 3,991

1

7

-11 2,566 2,879 3,334 3,031

2,784 2,664

4

6

-4

1,695 1,834 2,034 1,927

2,316 2,186

8

9

-6

1,293 1,431 1,672 1,562

Growth (%)

Two-

YoY year QoQ

CAGR

-10

7

-24

12

20

-44

35

2

-9

10

-5

3

3

3

11

4

18

-24

46

50

-29

3

9

-10

-3

7

2

5

9

-12

4

9

-38

8

12

-1

11

28

11

11

19

1

5

-2

-25

20

21

-1

17

6

31

-4

6

-16

42

-9

11

9

2

5

40

51

3

23

12

23

11

9

0

7

7

-1

LP

Loss 98

12

10

-9

11

-8

-31

10

6

-8

6

10

-10

5

9

-9

5

7

-5

9

10

-7

Sales/PAT for the MOFSL Universe to grow 4%/10% YoY in 1QFY26

Exhibit 16:

Expect sales for the MOFSL Universe to grow 4%

YoY in 1QFY26

Exhibit 17: Expect MOFSL Universe earnings to grow 10%

YoY in

1QFY26

3

July 2025

20

The CROSSOVER quarter!

Mastering the game!

Exhibit 18: Expect EBITDA margin (ex-Financials and OMCs)

to remain flat YoY at 19.9% in 1QFY26

Average: 20.2%

Exhibit 19: Expect PAT margin (ex-Financials and OMCs) to

contract and remain flat YoY at 9.6% during the quarter

Average: 9.5%

Source: MOFSL, excluding Financials and OMCs

Source: MOFSL, excluding Financials and OMCs

Exhibit 20:

O&G, Telecom, Tech, and NBFC-Lending to lead; while Auto, Metals, and Pvt. Banks to drag earnings for 1QFY26

157 27

20

17

17 13 12 12

11

8

7

6

5

4

4

3

2

1

1

0

0

0

11

12

24

2,939

3,220

Exhibit 21:

Quarterly sectoral PAT trend (INR b)

–

MOFSL Universe to report a 10% YoY growth in PAT in 1QFY26E

Sector

Automobiles

Banks-Private

Banks-PSU

Insurance

NBFC - Lending

NBFC - Non Lending

Capital Goods

Cement

Chemicals

Consumer

Consumer Durables

EMS

Healthcare

Infrastructure

Logistics

Media

Metals

Oil & Gas

Real Estate

Retail

Staffing

Technology

Telecom

Utilities

Others

MOFSL Universe

July 2025

June-22 Sep-22 Dec-22 Mar-23 June-23 Sep-23 Dec-23 Mar-24 June-24 Sep-24 Dec-24 Mar-25 June-25E

13

97

142

186

187

221

240

261

237

222

236

281

213

266

301

338

369

363

409

414

436

427

433

420

410

417

133

226

252

300

307

294

306

379

347

393

378

412

364

23

178

83

158

113

98

112

159

127

98

134

214

133

128

147

160

175

177

197

194

215

204

201

205

224

221

13

18

16

17

20

21

23

26

30

34

30

30

33

38

53

57

98

54

70

69

129

69

81

82

138

77

43

20

24

38

44

42

50

51

33

22

21

50

45

25

24

22

25

20

18

15

15

16

18

14

17

18

124

128

132

135

149

145

149

144

154

145

141

143

158

7

7

9

11

10

9

9

13

14

10

11

18

14

1

2

2

4

2

2

2

4

3

4

4

7

5

78

98

89

81

99

110

106

118

126

129

130

138

139

8

4

4

5

5

3

4

5

4

4

4

6

4

29

26

23

29

27

30

32

32

34

33

37

41

40

8

5

6

3

6

8

6

4

6

6

7

5

7

338

143

137

250

234

198

245

216

273

204

252

311

261

244

276

337

536

631

624

467

498

371

370

417

476

528

15

15

20

32

18

19

22

38

29

34

35

40

41

25

22

27

16

22

23

30

20

22

24

34

22

28

2

2

2

2

2

2

2

1

2

2

2

2

2

242

264

284

287

271

277

286

294

293

303

312

314

312

-47

-41

-58

-19

-29

-40

-32

-25

-17

-15

12

5

10

83

83

89

101

87

84

98

107

94

101

105

116

105

14

9

46

48

52

24

44

42

40

7

54

65

45

1,854 2,105 2,242 2,887 2,871 2,890 2,893 3,185 2,939 2,863 3,078 3,485 3,220

21

The CROSSOVER quarter!

Mastering the game!

Expect Nifty constituents’

earnings

to rise 5% YoY in 1QFY26







We expect sales/EBITDA/PBT/PAT for Nifty constituents to improve 7%/6%/

4%/5% YoY.

Reliance, Bharti Airtel, JSW Steel, HDFC Bank, ICICI Bank, Bajaj Finance, and Bajaj

Finserv are likely to drive Nifty earnings, while Coal India, TATA Motors, ONGC,

Maruti Suzuki, and IndusInd Bank are projected to drag the same.

Ten Nifty companies are likely to report a PAT growth of above 20% YoY.

Whereas 15 Nifty companies are expected to report a YoY decline in PAT.

109

Exhibit 22:

Sector-wise PAT breakdown for the Nifty constituents in 1QFY26E (YoY %)

Telecom, Retail,

and NBFC are likely

to lead Nifty

earnings in 1QFY26

26

18

18

17

17

15

9

8

8

6

5

4

1

0

0

-5

-14

Exhibit 23:

Expect Nifty’s revenue to

grow 7% YoY in 1QFY26

Exhibit 24:

Expect Nifty’s EBITDA to grow 6% YoY in 1QFY26

Exhibit 25:

Expect Nifty’s PAT to rise 5% YoY in 1QFY26

115

75

40

9

18

27

24

32

12

12

14

22

23

19

14

8

7

5

3

5

-36

July 2025

22

The CROSSOVER quarter!

Mastering the game!

Exhibit 26:

Nifty’s earnings snapshot

for 1QFY26E (INR b)

Sales

Growth (%)

EBITDA Growth (%)

PAT

Growth (%) Contribution to PAT

Company

Sector

Jun-25

YoY

QoQ

Jun-25

YoY QoQ

Jun-25

YoY QoQ

(%)

growth (%)

Bajaj Auto

Automobiles

123

2.8

1.0

24

0.0

-1.4

20

-0.2 -3.2

1.0

0.0

Eicher Motors

Automobiles

50

13.0

-5.3

12

0.2

-7.1

11

-3.4 -21.9

0.6

-0.4

Hero MotoCorp

Automobiles

97

-4.7

-2.7

13

-8.6 -5.8

10

-6.9 -3.3

0.5

-0.8

M&M

Automobiles

331

22.3

5.4

47

17.7

1.1

31

17.6 26.1

1.6

5.0

Maruti Suzuki

Automobiles

359

1.1

-11.6

38

-15.9 -11.2

30

-19.1 -20.5

1.5

-7.6

Tata Motors

Automobiles

997

-7.7

-16.6

109

-29.7 -34.4

36

-34.4 -59.1

1.9

-20.6

Axis Bank

Banks-Private

136

1.5

-1.2

106

5.3

-1.1

60

-1.0 -16.1

3.1

-0.7

HDFC Bank

Banks-Private

319

6.9

-0.5

261

9.3

-1.6

171

5.9 -2.8

8.9

10.3

ICICI Bank

Banks-Private

209

7.0

-1.3

177

10.6

0.4

120

8.5 -5.0

6.2

10.2

IndusInd Bank

Banks-Private

42

-23.1

36.4

23

-42.5

LP

6

-73.7 LP

0.3

-17.3

Kotak Mah. Bank Banks-Private

72

5.6

-0.8

54

2.2

-1.8

35

-1.1 -2.0

1.8

-0.4

State Bank

Banks-PSU

420

2.2

-1.7

272

2.9 -13.0

170

0

-8.8

8.8

-0.3

HDFC Life Insur.

Insurance

154

19.9

-36.1

8

18.4 -38.2

5

3.4 3.6

0.3

0.2

SBI Life Ins.

Insurance

176

13.1

-26.6

11

15.2 -32.7

6

14.2 -27.1

0.3

0.8

Bajaj Finance

NBFC - Lending

103

22.6

4.5

84

21.3

5.8

46

18.3 1.8

2.4

7.8

Bajaj Finserv

NBFC - Lending

310

19.7

2.5

92

19.5 10.0

28

31.0 15.8

1.5

7.2

Shriram Fin

NBFC - Lending

58

11.3

4.6

43

12.6

0.1

21

4.4 -3.3

1.1

0.9

Bharat Electronics Capital Goods

48

15.3

-46.9

11

15.3 -61.3

8

8.1 -60.1

0.4

0.7

Larsen & Toubro Capital Goods

618

12.2

-16.9

61

9.2 -25.2

34

20.6 -34.6

1.7

6.2

Grasim Ind.

Cement

88

28.1

-1.1

2

-32.1 0.1

-3

Loss Loss

-0.2

-2.8

Ultratech Cement Cement

218

20.8

-5.3

44

44.0 -5.3

22

32.3 -11.2

1.1

5.8

Asian Paints

Consumer

91

1.0

8.4

17

-1.1 16.7

11

-4.7 28.0

0.6

-0.6

Hind. Unilever

Consumer

164

4.5

4.8

37

-1.6

1.8

26

-1.7 1.3

1.3

-0.5

ITC

Consumer

194

5.1

3.4

68

0.5

4.0

52

2.5 2.8

2.7

1.4

Nestle

Consumer

51

5.7

-7.5

12

5.4 -16.1

7

-0.2 -14.6

0.4

0.0

Tata Consumer

Consumer

47

8.3

2.2

6

-8.4 -1.5

3

9.0 6.3

0.2

0.3

Apollo Hospitals Healthcare

57

12.8

2.6

8

15.6

1.4

4

25.7 -1.5

0.2

0.8

Cipla

Healthcare

69

3.6

3.0

16

-5.0

6.0

12

2.6 -1.1

0.6

0.3

Dr Reddy’ s Labs

Healthcare

84

10.0

-0.7

19

-10.3 -6.9

13

-6.2 -15.0

0.7

-0.9

Sun Pharma

Healthcare

134

7.2

4.7

37

4.5

12.4

32

15.6 10.0

1.7

4.7

Adani Ports

Logistics

86

23.4

1.1

52

21.5

3.1

31

16.9 0.4

1.6

4.8

Coal India

Metals

372

2.1

-1.5

115

-0.6

2.1

87

-20.8 -9.6

4.5

-24.7

Hindalco

Metals

608

6.6

-6.4

72

-3.4 -17.9

34

3.7 -35.1

1.8

1.3

JSW Steel

Metals

427

-0.5

-4.7

71

29.3 11.7

20

132.3 28.3

1.0

12.1

Tata Steel

Metals

501

-8.6

-11.0

70

4.0

6.1

16

20.1 -6.4

0.8

2.9

ONGC

Oil & Gas

304

-13.9 -13.2

166

-10.9 -12.7

77

-14.1 19.1

4.0

-13.6

Reliance Inds.

Oil & Gas

2,661

14.8

1.8

453

16.8

3.3

200

32.1 3.0

10.4

52.6

Titan Company

Retail

157

18.2

5.2

16

27.9

3.8

10

36.3 11.9

0.5

2.8

Trent

Retail

48

20.0

16.7

7

17.7

9.5

4

4.1 1.8

0.2

0.2

HCL Tech.

Technology

301

7.2

-0.5

63

9.7

-2.5

43

0.4 -0.7

2.2

0.2

Infosys

Technology

417

5.9

1.8

99

4.8

1.2

66

4.3 -2.4

3.4

3.0

TCS

Technology

646

3.2

0.2

170

1.9

0.7

125

2.9 1.3

6.5

3.8

Tech Mahindra

Technology

133

2.4

-0.5

19

20.9

1.3

12

36.5 -0.3

0.6

3.4

Wipro

Technology

220

0.4

-2.0

46

5.9

-1.4

32

6.9 -10.1

1.7

2.2

Bharti Airtel

Telecom

486

26.2

1.5

273

38.8

1.3

61

108.6 16.8

3.2

34.4

NTPC

Utilities

453

2.1

3.3

123

-0.9

9.6

44

5.0 -11.9

2.3

2.3

Power Grid Corp. Utilities

106

5.1

-3.6

93

5.9

0.4

37

6.6 -14.1

1.9

2.5

Eternal

Others

68

61.9

16.7

3

51.5 272.3

3

8.5 603.7

0.1

0.2

Nifty Universe

13,815

6.7

-4.2

3,624

6.4

-2.8

1,927

5.0 -5.3

100

100

Note: For Banks: Sales = Net Interest Income, EBITDA = Operating Profits; For Life Insurance: Sales = Net Premium, EBITDA = VNB.

July 2025

23