In a subdued Q2 for corporate India, where Nifty-50 earnings posted a modest 4% year-on-year growth—its slowest in 17 quarters—Motilal Oswal Financial Services highlighted stocks that defied the trend. The brokerage identified State Bank of India (SBI) and Larsen & Toubro (L&T) among ten winners delivering resilience and growth, while Tata Motors and Asian Paints led five laggards struggling under cost pressures and operational hurdles.

Motilal Oswal’s Q2 FY25 earnings report painted a striking picture of contrasts in corporate performance. With the Nifty-50 earnings falling short of historical averages, and Motilal Oswal’s broader universe posting a 1% decline year-on-year, some stocks stood out for their resilience and growth potential against this muted backdrop. On the other hand, the report identified laggards which struggled with valuation concerns, cost pressures, and operational challenges during the Q2 earnings.

The brokerage said that it had lowered its FY25 Nifty EPS estimates by 5% since August 2024, forecasting a modest 5% growth for Nifty earnings—marking the first year of single-digit growth in five years. The firm, however, added, “compared to the muted 1H, we expect corporate earnings to recover in 2HFY25, aided by a rise in rural spending, a buoyant wedding season in 2HFY25, and a pick-up in government spending.”

The winners pick:

The laggards:

Among the laggards, Tata Motors is expected to see limited growth, with its EPS growth remaining nearly flat for FY25, reflecting profitability challenges. Asian Paints faces cost pressures and valuation concerns, leading to a more moderate growth outlook. Avenue Supermarts (DMart) struggles with operational inefficiencies and high valuations, while ABB India is constrained by valuation pressures. IndusInd Bank is expected to see earnings growth but continues to grapple with lagging profitability and asset quality issues.


(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)