Indian equity markets may deliver a better showing in calendar year 2026 (CY26) after a notable underperformance in CY25, according to a report by Motilal Oswal Financial Services.
The brokerage cites a stabilising earnings environment and supportive macroeconomic conditions, driven by a series of monetary and fiscal policy actions from the Reserve Bank of India (RBI) and the Government of India.
Motilal Oswal highlights that Nifty valuations are trading near long‑term averages and that earnings upgrades are returning, improving the overall market outlook.
The brokerage now projects earnings for the Nifty index to grow at around a 12% compound annual growth rate (CAGR) over FY25–27, supported by moderation in foreign institutional investor (FII) outflows and broadening earnings revisions.
In the recent earnings season, about 34% of companies in the Motilal Oswal universe exceeded estimates, while roughly 32% missed, resulting in a balanced beat‑miss ratio.
Aggregate profit after tax (PAT) growth for this universe was 16% year‑on‑year in 3QFY26, slightly above expectations.
Within the Nifty, growth was led by heavyweights such as SBI, Tata Steel, HDFC Bank, TCS, and Bharti Airtel, which contributed the majority of incremental earnings.
However, companies like Tata Motors PV, Cipla, ICICI Bank, and Interglobe Aviation weighed on overall earnings performance.
Motilal Oswal also expects FII outflows to moderate over the course of the year, helped by progress on the India‑US trade agreement and the proposed Indo‑EU free trade agreement, although near‑term challenges remain, particularly in the IT services sector.
Indian equity markets CY26 mein better perform kar sakte hain after CY25 ki notable underperformance, Motilal Oswal Financial Services ke report ke mutabik.
Brokerage kehta hai ki earnings environment stabilising hai aur macroeconomic conditions supportive hain, jo RBI aur Government of India ke monetary aur fiscal policies se driven hain.
Motilal Oswal note karta hai ki Nifty valuations long‑term averages ke aas-paas trade kar rahe hain aur earnings upgrades wapas aa rahe hain, jo overall market outlook ko improve kar rahe hain.
Brokerage ka projection hai ki Nifty index ki earnings FY25–27 mein ~12% CAGR grow karegi, supported by moderate FII outflows aur broadening earnings revisions.
Recent earnings season mein, Motilal Oswal universe ki ~34% companies estimates exceed kar rahi hain, aur ~32% miss kar rahi hain, jo ek balanced beat‑miss ratio dikhata hai. Aggregate PAT growth 3QFY26 mein 16% YoY thi, thodi expectations se upar.
Nifty mein growth led by heavyweights jaise SBI, Tata Steel, HDFC Bank, TCS, Bharti Airtel, jinhone majority of incremental earnings contribute kiye.
Lekin Tata Motors PV, Cipla, ICICI Bank, Interglobe Aviation ne overall earnings performance ko thoda drag kiya.
Motilal Oswal ka expectation hai ki FII outflows aage chalke moderate honge, India‑US trade agreement aur proposed Indo‑EU free trade agreement se help milegi, lekin near-term challenges abhi bhi hain, especially IT services sector mein.