Strong earnings have helped D-Street to skyrocket to fresh record highs in the last two months and stocks which rose in anticipation of good earnings in the small & midcap space delivered over 100 percent net profit growth.
The June quarter earnings were largely in-line with expectations boosted by low base due to demonetisation and GST, but experts are building a case for earnings recovery which could well play over next two quarters.
For the first quarter, earnings were led by consumption and commodity companies, with metals and oil & gas accounting for more than 100 percent of the incremental earnings growth, suggest experts.
Within the consumption pack, auto lagged with a broad-based miss on profits and consequent earnings downgrades.
The June quarter earnings were largely in-line with expectations boosted by low base due to demonetisation and GST, but experts are building a case for earnings recovery which could well play over next two quarters.
For the first quarter, earnings were led by consumption and commodity companies, with metals and oil & gas accounting for more than 100 percent of the incremental earnings growth, suggest experts.
Within the consumption pack, auto lagged with a broad-based miss on profits and consequent earnings downgrades.
The Q1FY19 net profits of the Nifty50 index grew 12.3 percent which was 2 percent above our estimates due to lower losses of certain PSU banks. We model 20% growth in net profits of the Nifty-50 ndex for FY19 (down from 23% before 1QFY19 results season) and 24% for FY20,” Kotak Institutional Equities said in a note
However, valuations are heady and macro weak and faces growing risks from a large number of global issues. We note that 2-year growth numbers (CAGR) are quite mediocre, raising concerns about the strength and sustainability of the ongoing economic recovery, which is led by consumption demand. On the other hand, the Indian banking NPLs seem to be peaking and resolutions moving ahead, a good sign,” it said.
Strong earnings have helped D-Street to skyrocket to fresh record highs in the last two months and stocks which rose in anticipation of good earnings in the small & midcap space delivered over 100 percent net profit growth.
Stocks in the small & midcap space which have already more than doubled investor wealth in 2018 gave stellar results in June quarter where net profit grew by more than 100 percent. The list includes names like Dolat Investments, Graphite India, Mangalam Organics, Nelco, Excel Industries, India Glycols, Merck, Muthoot Capital, Jubilant FoodWorks, and L&T Technology Services, according to data compiled by AceEquity.,
Data suggests that top stocks when filtered from highest to lowest returns flagged these 10 stocks in which net profit grew by over 100 percent on a year-on-year basis. Are these top buys? Well, maybe not, at current levels, say experts.
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