Broader consumption may take another quarter to recover; Q2FY26 earnings of companies likely mixed: Report
(source : ANI) ( Photo Credit : ani)
New Delhi – A fresh analysis from Axis Securities warns that India’s broader consumption boost may still need another quarter to fully return to pre‑pandemic levels, even as some high‑frequency clues hint at gradual improvement.
The research says many firms are currently re‑shuffling stocks to get inventory levels in line with expected demand. That means retailers, manufacturers and other businesses are still trimming excess supplies before overall consumer spending normalises.
“We see a mixed trend coming out of Q2FY26 earnings, similar to past quarters that delivered lukewarm results,” the report added. It points to several headwinds that shape the outlook:
* Mixed U.S. policy cycles
* Sluggish rise in exports
* Devaluation of the rupee
* Implementation of GST 2.0
* A normal, evenly spread monsoon and healthy reservoir levels across the country
While some sectors look on the bright side, others will face continued pressure. Telecom, industrials, materials, utilities and consumer discretionary are expected to see a bounce‑back. In contrast, banks, staples and certain pharma segments may stay under stress.
On the financial side, the Nifty index is projected to grow in revenue, EBITDA and profit after tax (PAT) by 9 %, 4.8 % and 8 % year‑on‑year (YoY) for Q2FY26. If Interglobe Aviation is excluded, PAT growth is expected to hit about 6.5 % YoY.
The report stresses that, despite external challenges, India’s domestic economy remains healthy thanks to solid macro fundamentals. Fiscal plans for FY26 appear set to outpace FY25 growth, even though on a year‑to‑date basis the Indian market still lags behind the U.S. and many emerging markets.
In short, pockets of the economy are recovering, but full consumption demand and complete inventory alignment are likely to take another quarter. That’s why the Q2 FY26 earnings period is expected to be a mixed bag for investors.
Source: aninews
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