Over the past five quarters, average revenue and net profit growth have been 9% and 20%, respectively. In Q1FY25, revenue growth remained steady at 9%, but net profit growth was lower at 3%. This reflects steady revenue growth, although there are indications of a slowdown in profitability.
ETMarkets.comIn Q1FY25, real estate companies showed significant year-on-year growth in both revenue and profitability, surpassing other sectors. Banks and automobile companies also delivered consistent performance in sales and profitability, while the pharmaceutical sector displayed a substantial increase in profitability.
ETMarkets.com
ETMarkets.comIndian public and private banks reported year-over-year increases in total income and PAT during Q1FY25. Business momentum remained strong during the quarter, with moderate growth in lending. Leading banks witnessed sequential growth. Although the banks displayed growth in their advances, deposit growth remained sluggish, presenting a key concern for them. Net Interest Margins (NIMs) remained stable, with private banks continuing to report higher NIMs compared to PSU banks. Non-performing assets (NPAs) declined across both segments, reflecting improved asset quality. However, the banks faced pressure due to the sluggish performance of their Current Account & Saving Account (CASA) deposits.
The automotive sector had a strong quarter, with all companies reporting annual sales growth and most witnessing a surge in profit after tax. This growth was mainly driven by sales of two-wheelers, three-wheelers, and commercial vehicles, although passenger vehicles and tractors did not meet expectations. The sector expects moderate growth, supported by the government’s efforts to boost rural consumption and disposable income.
Indian IT giants have displayed resilience amid macroeconomic uncertainties. Major IT firms have exceeded market expectations, indicating robust performance and sequential growth across major markets. Despite profit and margin pressures, revenue growth remains strong, showcasing the sector’s potential.
The pharmaceutical sector maintained its strong performance, with profit after tax marking an impressive surge of 89% and total income rising by 13% year-on-year. Most of the companies have reported their best-ever quarterly results. The notable boost in profitability was driven by higher profit margins, controlled costs, expanded export opportunities in the US, and a change in the product mix.
In the real estate sector, mid-cap companies achieved significant sales growth, while large-cap companies faced a decline in annual sales. Despite this, most real estate companies reported higher profitability, driven by increased leasing activity and expansion into new areas.
The FMCG sector saw moderate revenue and marginal earnings growth. Government initiatives to boost employment and rural consumption suggest potential for future improvement in this sector.
On the other hand, the Nifty Energy and Nifty PSE sectors underperformed, with flat revenue and declining profitability.
Technical Outlook:
ETMarkets.comNifty experienced a volatile week, ending at 24,541, up 0.71% for the week. The index regained its position above the 20-day moving average after a period of consolidation. Nifty is sustaining above the 50% retracement level, indicating that the oversold territory has now been accounted for.
The daily RSI has recovered from lower levels and settled at 55. Nifty’s primary trend remains positive on the weekly time frame. Strong support is seen at 24,100, while 24,950 serves as a hurdle; a breakout above this level could extend the rally toward the 25,150-25,220 zone.
The global market remains neutral to positive, while the domestic market has followed the trend. India VIX currently stands at 14.40, remaining below the 15 mark. Overall, Nifty is anticipated to trade sideways with a positive bias.
