In focus with Tushar Pradhan - Aug 2022
Focus on the earnings growth trajectory
22 July 2022
In focus with Tushar Pradhan - Aug 2022
- Post the up move in July, Nifty index is now 7 per cent off from its highs (seen in mid-Oct 2021). Post the strong rally in July, valuations have inched up as earnings growth has remained largely intact. In the rising interest rate scenario, market returns may lag earnings growth given the probable moderation in valuation multiples
- Equity markets in India and globally rose sharply in July. Moderation in global commodity inflation during the month contributed to the positive equity market sentiments. FII flows turned positive for the first time since Sep-21
- S&P BSE Sensex & NSE Nifty indices were up 8.7 per cent / 8.9 per cent respectively, while the broader markets continued to underperform as BSE Midcap / BSE Smallcap indices went up 11 per cent / 9.3 per cent respectively. In terms of sectoral performance, metals, realty, capital goods and consumer durables were notable gainers while IT and energy were the laggards
- The quarterly results season has been a bit subdued as two heavyweights Reliance and Tata motors earnings were below consensus estimates. As of 31st July, 31 Nifty companies’ saw the aggregate Sales / EBITDA / PBT / PAT rising 29 per cent / 10 per cent / 15 per cent / 12 per cent YoY in Q1FY23; earnings growth was largely driven by Financials