New Delhi, July 6 (IANS) India Inc’s corporate earnings are pegged at a compound annual growth rate (CAGR) of around 15 per cent during FY26-FY28, supported by improving macroeconomic conditions, easing geopolitical concerns and stronger earnings visibility, a report showed on Monday.

The report by Motilal Oswal Financial Services Ltd. (MOFSL) said India is entering a more favourable phase after nearly two years of market consolidation, with attractive valuations positioning domestic equities to benefit from a potential rotation of global capital beyond artificial intelligence (AI)-focused sectors.

Easing energy prices, improving macroeconomic stability and strengthening corporate fundamentals are creating a constructive environment for Indian equities over the medium term, it added.

For the June quarter (Q1FY27), the domestic brokerage has expected that earnings across its coverage universe will decline 3 per cent year-on-year, largely due to weakness in oil marketing companies (OMCs).

However, excluding OMCs, profit after tax (PAT) is projected to grow 14 per cent year-on-year, indicating healthy earnings momentum across several sectors.

Sector-wise, the report said financials and metals would lead earnings growth during the quarter.

Lending non-banking financial companies (NBFCs), private and public sector banks, metals, technology, capital goods, retail, consumer durables and building materials are also expected to post healthy performances.

In contrast, the oil and gas, automobile, healthcare and cement sectors are likely to weigh on overall earnings growth.

Investors should closely track two key factors in the coming months — the direction of foreign institutional investor (FII) flows and the market’s ability to absorb a robust pipeline of initial public offerings (IPOs) and capital raising without affecting liquidity, the brokerage said.

The report said that India’s long-term growth fundamentals remain intact, with the next phase of the market expected to be driven increasingly by company-specific earnings performance and execution rather than broad market trends.

–IANS

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