The sources provide specific corporate earnings and performance data for the quarter ended September 30, 2025 (Q2 FY26 or Q3 CY2025), alongside broader updates signaling macroeconomic strength, shifts in capital expenditure, and significant corporate restructuring.
Here is a discussion of corporate earnings and performance:
Corporate Earnings and Performance (Q2 FY26 / Q3 CY2025)
The corporate updates highlight generally positive revenue and profit growth for consumer-facing and infrastructure-related Indian giants, reflecting favorable domestic conditions, while also showcasing the specific risks and financial strategies adopted by companies in sectors like IT services and manufacturing.
I. Sectoral Performance Highlights
1. Infrastructure and Capital Goods (Larsen & Toubro - L&T)
L&T, a major indicator of infrastructure health and private capital expenditure (capex) revival, reported strong performance for the September quarter:
- Revenue and Profit Growth: L&T’s consolidated revenue saw a 10% jump year-on-year to ₹67,984 crore for the September quarter. Consolidated profit grew by 16% to ₹3,926 crore.
- EBITDA: Earnings before interest, tax, depreciation, and amortization (Ebitda) rose 7% year-on-year to ₹6,806 crore. However, the Ebitda margin narrowed by 30 basis points to 7.3%.
- Order Book and Capex Revival Signal: The most significant performance metric was the sharp recovery in domestic infrastructure orders. The company’s infrastructure projects segment received domestic orders worth nearly ₹27,400 crore in the quarter, an increase of almost 50% compared to a year earlier. This marks the first time domestic order receipts for this segment crossed the ₹20,000 crore mark after five fiscal quarters, flashing the "first signs of a much-awaited recovery in India's private capital expenditure (capex)".
- L&T’s total order inflow for the quarter was ₹1.16 trillion at a consolidated level, its highest ever in any quarter, primarily led by significant project wins in West Asia (Middle East). The total order book now stands at a company record of ₹6.67 trillion.
- Global Contribution: About 56% of L&T's revenue came from overseas during the September quarter, up from 52% in the same period last year.
2. Consumer Technology and Fintech (PB Fintech & Apple)
- PB Fintech (Policybazaar Parent): The parent company reported strong financial results driven by insurance and credit disbursals.
- Revenue: Consolidated revenue from operations was ₹1,614 crore in the September quarter, marking a 38% year-on-year and 20% sequential increase.
- Profitability: Profit after tax (PAT) stood at ₹135 crore, reflecting a 58% sequential and massive 165% year-on-year increase. The PAT margin improved to 8% in Q2, up from 4% a year earlier.
- Key Drivers: Total insurance premium grew 40% year-on-year to ₹7,605 crore, driven primarily by a 44% jump in online new protection business, with health insurance contributing about 60%. Renewal or trail revenue grew 39% year-on-year to ₹774 crore.
- Apple: While Apple does not disclose India-specific revenue, its performance in the country is estimated to be highly robust.
- The iPhone 17 set a launch record in India, becoming the largest-selling Apple smartphone in the first month of launch, with sales 15-20% higher than earlier models in the first 30 days.
- Analysts estimate that Apple ended FY25 with over $10 billion in revenue from India, which translates to 2.5% of its $400.4 billion in global revenue during that period. This reflects India’s growing importance, with the CEO noting India’s record revenue for 14 straight quarters.
3. Cement (Shree Cement)
Shree Cement's performance displayed a mixed picture of strong pricing but lagging volumes:
- Profitability vs. Volume: Adjusted standalone Ebitda grew 48% year-on-year to ₹875 crore in the September quarter. The profitability metric, Ebitda/tonne (adjusted), rose 42% year-on-year to ₹1,108.
- Volume Concerns: Despite the strong margin performance, the company sold only about 7.9 million tonnes (mt) of cement in Q2, an increase of 3.9% year-on-year, which was in line with industry growth. However, volumes in the first half (April-September) fell 2% year-on-year compared to the industry’s estimated 4% growth. Analysts express concern over the company losing market share to peers by prioritizing premium pricing over volume.
4. Automotive (TVS Motor Co. Ltd.)
TVS Motor Co. demonstrated strong operational and financial performance, outperforming the two-wheeler industry:
- Financial Growth: Standalone Ebitda rose as much as 40% year-on-year to ₹1,500 crore in the September quarter (Q2 FY26). Revenue increased 29% to ₹11,900 crore.
- Volume and Market Share: Sales volume increased by an impressive 23% to 1.51 million units, significantly higher than the largely flat industry performance. This robust growth helped TVS Motor increase its two-wheeler market share by 200 basis points to 19.6%.
- Drivers: Performance was driven by higher volumes, improved realization (up 5% due to price hikes), improved retail financing, and GST cuts, which provided entry-level customers savings of almost ₹7,000. Exports grew at a faster 30% rate in Q2, now contributing over 25% of volumes.
5. Beverages (Varun Beverages Ltd. - VBL)
VBL, a PepsiCo bottler, reported solid profit growth despite difficult weather conditions:
- Profit Growth: Consolidated profit after tax rose 18.5% year-on-year to ₹745.2 crore in the September quarter (Q3 CY2025).
- Revenue and Volume: Consolidated revenue was ₹5,047.74 crore, up from ₹4,932.06 crore year-on-year. Consolidated sales volume grew 2.4% to 273.8 million cases.
- Drivers: The profit increase was attributed mainly to lower finance cost and higher other income (including interest on deposits and favorable currency movement in international territories), compensating for higher total expenses.
6. Power and Energy (Coal India & ManipalCigna Health Insurance)
- Coal India Ltd.: The state-owned coal producer reported a steep decline in profitability. Consolidated profit fell 32% to ₹4,262.64 crore in the September quarter, down from ₹6,274.80 crore a year ago. This was attributed to lower sales (consolidated sales fell to ₹26,909.23 crore) and higher expenses (up 7% to ₹26,421.86 crore).
- ManipalCigna Health Insurance Company Limited: The company reported a loss. Total Income from Operations was ₹54,437 lakhs for the three months ended September 30, 2025. Net Profit/(Loss) for the period after tax was a loss of (₹19,706 lakhs), worsening from a loss of (₹8,007 lakhs) in the year-ago period. Basic and diluted Earnings Per Share (EPS) were both (₹1.15).
II. Valuation, Guidance, and Corporate Financial Strategy
1. IT Services and Valuation Arbitrage (Cognizant)
Cognizant Technology Solutions Corp. reported $5.42 billion in revenue for the third quarter, an increase of 7.36% year-over-year and 3.24% sequentially, beating analyst estimates.
- Raised Guidance: Cognizant raised its guidance for the full year, translating to 6.6%-6.9% annual growth, up from the earlier range of 4.7%–6.7%.
- Listing Motivation: The company is considering a primary offering and a secondary listing in India due to the expectation of better valuation in the country. Homegrown IT services firms typically trade at 22-23 times earnings, significantly higher than Cognizant’s current price-to-earnings ratio of about 13.
2. Pricing and Valuation in IPOs (Studds Accessories)
The ongoing IPO of Studds Accessories highlights the current high valuation climate in India:
- The company's Price to Earnings Ratio (P/E) at the upper end of the price band is 33.05 times, which is substantially higher compared to the Nifty P/E ratio of 22.67 times as of October 24, 2025.
- The Return on Net Worth (RoNW) for the company has shown improvement, rising from 9.81% in Fiscal 2023 to 14.77% in FY24, and 15.49% in FY25.
3. Global AI and Tech Outperformance (Nvidia)
The American AI chip designer Nvidia demonstrated historic performance and valuation milestones driven by the global AI frenzy:
- Market Capitalization: Nvidia achieved a historic $5 trillion market capitalization on Wednesday, rallying 5.2%. It took only four months to breach the $5 trillion barrier after crossing $4 trillion.
- Market Impact: The stock is solely responsible for nearly a fifth of the S&P 500 Index’s 17% advance in 2025.
- Valuation: Despite the massive rally, Nvidia shares are priced at less than 34 times estimated earnings, which is below their five-year average of about 39.
III. General Economic and Market Context
The corporate earnings and future plans are set against a backdrop of domestic strength and global uncertainty:
- Macroeconomic Tailwinds in India: India's macroeconomic scorecard is characterized as "stellar". Inflation has dropped to sub-4% levels, and the current account deficit is expected to be less than 1% of GDP in 2025-26. India's GDP growth forecast for 2025 has been raised by the IMF from 6.4% to 6.6%.
- Cost and Expense Management: Companies are facing shifts in operating environment:
- Air India faces massive financial challenges, reporting losses widening to ₹10,859 crore in the last financial year (FY25), making it the largest loss-maker for the Tata Group. The airline is currently facing an estimated ₹4,000 crore ($500 million) hit from the closure of Pakistani airspace.
- Mutual Fund Regulation: Proposed SEBI changes to cap brokerage and transaction costs charged by Asset Management Companies (AMCs) are expected to squeeze AMC profit margins by increasing operating costs in the short term, leading to shares of major fund houses falling as much as 8%.
- Global Corporate Restructuring: Tens of thousands of white-collar jobs are disappearing in the U.S. at large employers like Amazon, United Parcel Service (UPS), and Target. This trend is partly driven by investor pressure for greater efficiency and the increasing adoption of Artificial Intelligence (AI) to handle tasks previously performed by well-compensated staff.
No comments:
Post a Comment