The October-December quarter earnings introduced a blended bag of surprises throughout sectors. Whereas rural demand revival lifted consumer-driven industries, city consumption remained sluggish. Banks posted sturdy revenue progress regardless of internet curiosity margin (NIM) strain, and IT corporations managed margin enlargement amid delicate discretionary spending. Let’s break down the hits and misses from Q3.
Cars
Hit: Rural restoration fueled demand for two-wheelers and tractors, boosting income for main gamers like M&M. New launches within the passenger automobile (PV) and business automobile (CV) segments additionally aided gross sales momentum. Luxurious automotive gross sales remained strong, benefiting from premiumization traits.
Miss: Quantity progress remained tepid regardless of larger common promoting costs. Eicher Motors confronted margin pressure resulting from elevated advertising spends, and EV adoption remained sluggish resulting from infrastructure challenges.
Outlook: With rural demand gaining traction, tractors and entry-level bikes are set to drive gross sales. EV adoption and new mannequin launches will likely be key progress triggers. Rising enter prices, nonetheless, may put strain on profitability.
Income Change (YoY): 6.1% Web Revenue Change (YoY): -1.2%
IT
Hit: A rebound within the US BFSI vertical, which contributes over a 3rd of high IT exporters’ income, supported earnings. Regardless of seasonal headwinds, main corporations expanded margins. Price optimization measures helped main gamers like Infosys and TCS keep working profitability.
Miss: Giant transformational offers stay elusive, with corporations like Wipro and HCL Tech seeing larger traction in short-term contracts, which usually carry decrease margins. Hiring exercise remained muted as corporations targeted on enhancing utilization ranges.
Outlook: Whereas progress expectations have been priced into inventory valuations, near-term momentum stays subdued. AI-led transformation offers and automation investments may drive medium-term progress.
Income Change (YoY): 6.4% Web Revenue Change (YoY): 11.7%
Oil & Gasoline
Hit: RIL’s larger refining throughput and HPCL’s strong refining margins offered a cushion towards falling gasoline realizations. ONGC posted a shock enhance in crude manufacturing, aided by larger international demand.
Miss: BPCL fell quick on refining and advertising margins, whereas metropolis gasoline distributors (CGD) noticed weaker earnings resulting from costlier gasoline sourcing. Unstable crude costs continued to impression profitability.
Outlook: Steady efficiency anticipated post-elections, with ONGC doubtless hitting peak crude capability by March 2025. Gasoline worth volatility stays a key danger.
Income Change (YoY): -0.1% Web Revenue Change (YoY): -11.3%
Pharma
Hit: Solar Pharma’s sturdy home and rising market gross sales, together with milestone earnings from a US accomplice, lifted earnings. Aurobindo Pharma benefited from increasing EU operations. Dr. Reddy’s noticed sturdy biosimilar traction in key markets.
Miss: Solar Pharma’s US generics enterprise suffered resulting from high quality considerations, whereas Apollo Healthcare’s rising pharmacy prices pressured margins. Export pricing pressures additionally impacted smaller gamers.
Outlook: Regardless of near-term margin pressure, demand for gRevlimid within the US and biosimilar approvals bode effectively for FY25. Growth in specialty pharma will likely be essential for sustained progress.
Income Change (YoY): 10.6% Web Revenue Change (YoY): 24.3%
Banking
Hit: PSU banks recorded decrease slippages and credit score prices, with some posting document income on diminished unhealthy mortgage provisions. Non-public lenders like HDFC Financial institution benefited from sturdy mortgage e book enlargement.
Miss: NIM strain endured as banks competed for deposits amid tight liquidity. Credit score progress slowed barely within the retail phase.
Outlook: The RBI’s charge reduce cycle may intensify NIM stress, however tax reduction measures could enhance deposit accretion. Company lending is predicted to choose up tempo in H2 FY25.
Income Change (YoY): 12.1% Web Revenue Change (YoY): 12.0%
Client & FMCG
Hit: Rural demand improved, benefiting FMCG gamers and choose shopper corporations. Asian Paints noticed traction in its industrial ornamental phase. Nestlé and Britannia posted sturdy volume-led progress.
Miss: City demand confirmed indicators of fatigue, and working margins remained beneath strain. ITC struggled with margin compression in FMCG, cigarettes, and paper. Enter price inflation weighed on profitability.
Outlook: Budgetary tax reduction may support demand restoration in FY26. Premiumization and e-commerce penetration will drive sectoral enlargement.
Income Change (YoY): 11.7% Web Revenue Change (YoY): 11.6%
Telecom
Hit: Cell knowledge consumption surged, and EBITDA margins remained resilient. Airtel outperformed friends with an ARPU of Rs 245, rising 18% YoY. 5G subscriber additions boosted income progress.
Miss: Jio’s ARPU grew simply 11.9% YoY to Rs 203, reflecting muted tariff features. Vodafone Thought continued to battle with excessive debt and weak money flows.
Outlook: Subsequent tariff hikes anticipated in H2 CY25, with digital service enlargement enjoying a key position in income progress. 5G monetization stays the most important set off for telcos.
Income Change (YoY): 4.8% Web Revenue Change (YoY): 159.2%
Cement
Hit: Quantity restoration after the monsoon stoop helped UltraTech and Shree Cement beat expectations. Price optimization measures supported EBITDA enchancment in choose corporations.
Miss: Profitability took successful resulting from decrease realizations and weaker demand, with EBITDA margins dropping over 300 bps YoY. Rising vitality prices remained a priority.
Outlook: Improved pricing and regular demand ought to help progress, with administration commentaries hinting at higher realizations in This autumn. Infrastructure push from authorities spending stays a key demand driver.
Income Change (YoY): 0.8% Web Revenue Change (YoY): 13.7%
Backside line
Whereas rural demand revival and price efficiencies helped a number of sectors, city demand weak point and margin pressures endured in key industries. With elections behind and coverage readability forward, companies are banking on FY26 for a broader revival. Nonetheless, international financial uncertainties and inflation dangers stay key variables that might impression progress trajectories.
