Arora believes that earnings for the January–March 2025 quarter (Q4FY25) were relatively better when compared to the average of the past eight quarters, particularly in terms of the upgrade-to-downgrade ratio.
While no major disappointments are expected in the April–June 2025 quarter (Q1FY26), recent developments such as Trump’s tariffs and geopolitical shifts, could keep investors looking for clues from IT companies’ 12-month outlook. The sector accounts for nearly 12% of the index and its performance remains crucial.Read Here | HSBC MF CIO sees discretionary demand and credit growth rebounding by year-endHe expects banks to perform reasonably well and the consumer segment to remain somewhat soft.
Cement, durables, and electricals are likely to remain flat, and defence is expected to hold steady. EMS players continue to perform well, although there has been some slowdown due to intermittent rains in various parts of India during the first quarter.
However, forecasts suggest a favourable monsoon, which could boost rural demand. In such a scenario, two-wheelers, consumer staples, and NBFCs that operate heavily in rural areas could benefit. Credit growth to the agricultural sector might also improve. The rural economy remains an important area to monitor, while consumer discretionary continues to show strength.
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