India Inc. could be poised for a difficult first quarter of FY27, with JPMorgan's Rajiv Batra warning that earnings are likely to face considerable pressure at a time Indian markets have been rocked by geopolitical disruptions including Iran war, higher input prices and currency depreciation. This comes even as Q4FY26 results fared better than expected.
In his latest India Strategy note, Batra said results for the quarter were broadly ahead of estimates. But he noted that management commentary across companies flagged macro, logistics and pricing risks as key concerns heading into FY27.
Although FY27 growth outlooks have been largely maintained for now, a prolonged disruption could force these managements to opt for a potential revision, JPMorgan says.
"If the disruption lasts longer than expected, companies might be forced to reduce their full-year outlook on upcoming calls," Batra cautioned. Inflation and El Nino remain additional risks to monitor for demand resilience through FY27.
Top Sectoral Picks
At a time when markets have been gripped with volatility, JPMorgan is learning heavily towards high-growth domestic cyclicals, which are insulated from global trade volatility and commodity swings.
The brokerage firm's most significant call is an upgrade of Industrials to 'overweight' from 'neutral', driven by three structural tailwind: strong government-backed infrastructure spending and electrification demand, the defense modernisation and indigenisation push, and India's broader manufacturing expansion agenda.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.