As the brokerage reflects on Q4 FY25 earnings estimates in this note, the world stands in the most uncertain economic environment of this decade. The 2020s began with the shock of Covid-19, but the market weathered it rather well after a sharp but short-lived correction, laying the foundation for one of the most significant equity market upswings. Midway through the decade, the tariff war unleashed by the US can have a material bearing on the global economy, corporate earnings, and equity markets. It would be premature to make a definitive assessment of the tariff war's effects, as it may have many more developments to unfold.
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Motilal Oswal Report
We expect our earnings to grow by a modest 1% YoY, while those of Nifty would also grow 2% YoY in Q4 FY25. Excluding financials, the earnings are expected to grow 1% YoY and 4% YoY, whereas, excluding global commodities (i.e., Metals and O&G), our Universe and Nifty are likely to report 5% and 4% YoY earnings growth, respectively, for the quarter.
The earnings growth during the quarter is likely to be driven by Metals (+24% YoY), Telecom (loss to profit) and Healthcare (+11% YoY), with modest earnings contributions from BFSI (+2% YoY), and Technology (+6% YoY).
The earnings growth of Private Banks, PSU Banks, and NBFC-lending is expected to moderate to -3%, 4%, and -1% YoY, respectively. The private banks sector is projected to report the first quarter of earnings decline since Mar'20, while the PSU Banks sector is likely to report moderate earnings growth, the lowest in 19 quarters. NBFC-lending and NBFC-non-lending are also set to post weak earnings growth of -1%/ 5% YoY, the lowest in 15/11 quarters.
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