Halfway through the results season, preliminary data for the January–March quarter (Q4FY23) reveals that frontline companies have outperformed predictions, with firms in the banking and financial services (BFSI) sector outperforming those in other industries.
According to a research by Motilal Oswal Financial Services (MOFSL), the 26 Nifty businesses who published their results in Q4FY23 together recorded a 10% increase in net profit, versus a projected 7% increase.
Without BFSIs, combined earnings would decline by 1% as opposed to an anticipated 4% decline, the report claimed. While technology and consumer goods firms matched analysts’ predictions, the main corporations in the automotive and oil and gas industries also outpaced the competition.
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Strong Bank and Profits results:
The 26 out of the 50 Nifty components that released results collectively generated a cumulative net profit of over Rs 1,02,200 crore, an increase of almost 10% on an annual basis. According to the MOFSL study, the equivalent figures for 20 of the 30 sensex elements were around Rs 9,75,00 crore, or a 9% annual increase.
The by Gautam Duggad and Deven Mistry stated that five businesses of the Nifty components (Reliance Industries, Axis Bank, ICICI Bank, HDFC Bank, and TCS) have contributed 121% of the additional YoY accretion in earnings. Tech Mahindra (-2%) and Tata Steel (-90%) have had a negative impact on Nifty earnings. Furthermore, if metals and oil & gas were excluded, Nifty gains would have grown 22% YoY (against a projected 21% rise).
The earnings per share (EPS) of the Nifty index for FY23 and estimates for FY24 remained largely unchanged at Rs 816 and Rs 976 (compared to Rs 812 and Rs 978 earlier), respectively, according to the quarterly results that have been released so far. Downgrades in technology are offset by improvements in BFSI and automobiles, the report said.
Reliance Industries, Axis Bank, Kotak Mahindra Bank, HDFC, Bajaj Auto, Hero Motocorp, Nestle, and SBI Life Insurance among the Nifty components all outperformed analyst net profit projections, according to data. Tata Steel, Maruti Suzuki, Infosys, Tata Consumer, and HDFC Life Insurance, on the other hand, missed their earnings projections.
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