Nifty50 Q4 FY25 Earnings Beat Estimates with 48%; But FY26 & FY27 EPS Outlook gets revised

Q4 FY25 saw better-than-expected results, with 48% of Nifty50 companies beating earnings estimates. Overall, earnings per share (EPS) grew by 4.9% YoY, breaking expectations of a 2.2% YoY decline from the same quarter last year, reports JM Financial.

However, despite this strong quarter, JM Financial have revised down the Nifty50 EPS estimates for FY26E and FY27E by 5.3% and 5.9% respectively. This means our projected EPS growth for FY26E is now 12.0% (down from 16.4% earlier), and for FY27E, it's 14.3% (down from 15.1%).

Sectors like Telecom, Metals & Mining, and Oil & Gas are expected to drive Nifty50's EPS growth in FY26E. While Automobiles, Cement, Oil & Gas, and NBFCs is projected to have significant EPS cuts for FY26E.

Nifty50 Performance in 4QFY25

In Q4FY25, Nifty50 EPS grew 4.9% YoY with 48% companies beating the estimates, while 18% missing it, and the remaining reported in-line results to the estimates. As per market capitalization, small-cap companies saw the highest proportion of misses at 31%, followed by mid-caps at 28%, and large caps with the lowest miss rate at 17%.
Sectoral Performance in Q4FY25

During Q4FY25, several sectors experienced declines in EPS including Financials (-1.8% YoY), Oil & Gas (-6.6% YoY), IT (-3% YoY), and Consumer (-9.3% YoY). While Metals & Mining (+33.2% YoY), Ports and Logistics (+23.3% YoY), Industrials (+18% YoY), and Infrastructure (+16.7% YoY) had highest growth.

EPS Estimates for FY26E and FY27E

JM Financials have reduced the Nifty50 EPS for FY26E and FY27E by 5.3% and 5.9% respectively. FY26E EPS growth is now projected at 12.0% (down from 16.4% previously), and FY27E growth is revised to 14.3% (from 15.1%). For FY26E, the largest EPS cuts are anticipated in the Automobiles, Cement, Oil & Gas, and NBFCs sectors.

However, sectors expected to be key drivers of growth in FY26E include Consumer (+14% YoY), Telecom (+73% YoY), Metals & Mining (+23% YoY), Oil & Gas (+23% YoY), and Banks (+7% YoY), with Banks holding a significant 37.7% weight in Nifty50 PAT.

JM Financial Coverage Universe Performance

Within JM Financial's coverage universe, EPS grew by 9.5% YoY in 4QFY25. The strongest performances were seen in EMS (+113% YoY), Aviation (+62% YoY), and Healthcare (+44% YoY). While, the weakest performers included Building Materials (-28% YoY), Depositories (-22% YoY), and Auto Ancillaries (-17% YoY). Compared to estimates, the largest beats were seen in Internet, followed by EMS and Utilities. Among the misses, Healthcare and Real Estate led the pack.

Overall Sentiment

According to Morgan Stanley report, India presents a combination of macroeconomic stability, consistent earnings growth, and strong domestic demand, making it a relatively safe option during global market downturns. However, in a global bull market, where investors often seek higher-risk, high-reward opportunities, India's more measured and steady growth may cause it to underperform compared to more volatile, high-beta markets.