Winners and losers of India’s Q1 earnings season: who’s cashing in, who’s struggling

India’s corporate earnings season has gathered pace through July, with Reliance Industries reporting on Friday and HDFC Bank, ICICI Bank and Kotak Mahindra Bank following on Saturday. Results so far show a mixed picture — profits have grown consistently across companies, even as some missed analyst estimates — and ratings agency Crisil now estimates overall corporate revenue will grow 11-11.5% in the April-June quarter of FY27.

Some sectors are clearly ahead. Automobiles, white goods, telecom services, power generation, steel and healthcare all drew strength from resilient domestic demand. A spell of intense summer heat lifted demand for air conditioners and other seasonal appliances, reversing a slump from a year earlier when heavy rains hurt sales, while power firms benefited from peak seasonal demand and telecom companies gained from premiumisation and data monetisation.

Others are struggling. Construction revenue is estimated to rise just 1-3% as geopolitical disruptions slowed project execution and delayed revenue recognition, despite healthy order books — L&T will report its Q1 FY27 results on 28 July. Airlines fared worse still: rising aviation turbine fuel costs, combined with softer passenger traffic, are estimated to drag operating profit margin down by around 1,000 basis points, the steepest hit of any sector Crisil tracked.

Behind the headline growth number lies a shift in how companies are making their money. ‘Pricing, rather than volume, is behind much of the growth this quarter — a reversal from the past two years,’ said Sehul Bhatt, director-research at Crisil. Steel and cement makers leaned on stronger prices, and FMCG revenue — estimated to grow 6-7% — was driven largely by price increases rather than higher sales volumes, even as packaging, logistics and food-related costs weighed on margins.

Individual results reflect the same split. Nuvoco Vistas Corp posted a 7% rise in operating profit to Rs 572 crore, its highest-ever first-quarter figure, with managing director Jayakumar Krishnaswamy pointing to cost discipline. Berger Paints managing director Abhijit Roy said the company expects ‘double digit value growth’ in the quarter. Meanwhile, IT services revenue is estimated to grow just 5%, driven mostly by favourable currency movements rather than fresh enterprise spending — TCS’s profit rose about 5% to Rs 13,349 crore, while Wipro’s stayed flat at Rs 3,356 crore.

Crisil expects corporate operating profit margin overall to contract 75-100 basis points year-on-year, as firms absorbed part of the cost increases rather than passing it fully to customers. It flagged the monsoon’s effect on rural demand and food inflation, and the West Asia conflict’s effect on energy prices, as the key factors to watch — warning that margin pressure could deepen further in the second quarter if the West Asia uncertainty persists, though the festive season is expected to support demand in the back half of the year.

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