JPMorgan expects stronger revenue growth to help Indian companies weather near-term pressure on profit margins in the June quarter, while upgrading its view on the pharmaceutical sector and retaining a bull-case target of 30,000 for the Nifty 50.
The brokerage expects Q1FY27 earnings to be shaped by easing macro headwinds but elevated raw material costs, particularly oil and petrochemical inputs. While these costs could weigh on profits, JPMorgan views the pressure as a temporary, inventory-driven headwind.
The brokerage expects Nifty 50 companies to report aggregate year-on-year growth of 10% in revenue, 9% in Ebitda and 10% in profit after tax, according to Bloomberg consensus estimates. JPMorgan's own estimates point to median growth of 12% in revenue and 9% in profit.
JPMorgan's MSCI India earnings growth forecasts stand at 11% for 2026 and 13% for 2027. Its year-end bull, base and bear-case targets for the Nifty 50 remain unchanged at 30,000, 27,000 and 20,500, respectively.
Pharma Upgraded As Weak Rupee Offers Support
JPMorgan upgraded pharmaceuticals to Neutral, citing healthy earnings visibility and the potential boost from a weaker rupee.
The brokerage expects a stable US market, supported by strong product launches and a favourable pricing environment, while Indian pharmaceutical companies continue to post low-teens domestic growth. It also sees robust growth across other international markets.
JPMorgan expects revenue, Ebitda and profit after tax for its healthcare coverage to grow at compound annual rates of 12%, 14% and 15%, respectively, between FY26 and FY28.
The brokerage remains Overweight on financials, industrials, healthcare, materials and consumer discretionary, while retaining an Underweight stance on information technology.
ALSO READ: Syrma SGS Wins 'Buy' Rating From HSBC With 29% Upside: What Is Driving The Bullish Call?
Revenue Growth Could Cushion Margin Pressure
JPMorgan expects the bigger upside risk to come from corporate top lines. Healthy domestic demand, strong credit growth, robust GST collections and resilient nominal GDP trends could drive better-than-expected revenue growth, it said.
For companies under its coverage excluding oil marketing companies, JPMorgan expects aggregate revenue to rise 5% year-on-year, with Ebitda and profit after tax growing 12% and 11%, respectively.
The brokerage expects small- and mid-cap companies to continue delivering stronger earnings growth than large caps. Financials, materials, consumer discretionary and industrials are expected to contribute meaningfully to earnings growth in 2026.
Essential Business Intelligence, Sharp Market Insights, Practical Personal Finance Advice, Daily Fuel, Gold and Silver Prices and Latest Stories — On NDTV Profit.