Capital Goods Stocks Outlook
Company-specific action seen; L&T earnings eyed
This story was originally published at 19:59 IST on 25 July 2025
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NEW DELHI – The capital goods sector is likely to see stock-specific action next week with some large-caps, including Larsen & Toubro and Bharat Electronics, set to report their earnings. The poor corporate earnings so far in the June quarter have raised risks of investors taking profits, analysts said.
Among companies in the sector, Supreme Industries and CG Power and Industrial Solutions have reported their June quarter earnings, which revealed that there are still segments that face issues arising from weak demand. Supreme Industries missed analysts expectations as revenue in its major segment of plastic pipes declined on year.
"During the quarter the Plastic Pipe Systems business growth was adversely affected due to unfavourable PVC (polyvinyl chloride) resin prices scenario and demand from infrastructure spend not picking," IDBI Capital Markets & Securities said in its post-earnings report Friday. The brokerage downgraded the stock to "hold" and cut its target price by 4% to INR 4,395 per share.
Other brokerages acknowledged the weak June quarter earnings but also pointed to hopes of earnings picking up in the second half of the current financial year with demand expected to improve. Supreme Industries raised its guidance for consolidated volume growth to 14-15% in the financial year 2025-26 (Apr-Mar), HDFC Securities said in its report. Shares of Supreme Industries ended slightly higher Friday at INR 4,311.70 on hopes of better earnings ahead.
CG Power missed expectations on net profit but reported better-than-expected revenue for the June quarter. Its net profit for Apr-Jun was up nearly 12% on year at INR 2.69 billion and revenue was up 29% at INR 28.78 billion. "Industrial business profitability was impacted by a rise in input costs amid weak demand and an unfavorable mix," Emkay Global Financial Services said in its post-earnings report on the company.
While the June quarter was mixed for CG Power, Emkay Global is bullish on the company's power systems business and hopes for market share gain in the industrial motors business. The brokerage has a "buy" rating on the stock with a target price of INR 765.
Larsen & Toubro is set to report its earnings Tuesday, which will provide cues to investors about demand in the sector. According to the average of estimates by nine brokerages, the company is expected to report a 36% year-on-year rise in consolidated net profit for the June quarter to INR 37.87 billion.
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Following are the resistance and support levels for the stocks for next week as per calculations based on their prices on the National Stock Exchange:
| Company | Price | Week-on-week change in % | Resistance | Support |
| Bharat Heavy Electricals | 240.15 | (-)4.10 | 255.00 | 232.00 |
| CG Power and Industrial Solutions | 662.55 | (-)0.80 | 704.40 | 639.10 |
| Larsen & Toubro | 3,442.90 | (-)0.60 | 3,492.00 | 3,412.80 |
| Siemens | 3,038.20 | (-)2.90 | 3,165.90 | 2,966.30 |
| Thermax | 3,739.00 | (-)3.80 | 3,899.10 | 3,640.70 |
| Bharat Electronics | 395.20 | 0.10 | 403.70 | 389.30 |
| S&P BSE Capital Goods | 69136.11 | (-)1.50 | 70903.90 | 68209.10 |
| Nifty 50 | 24837.00 | (-)0.50 | 25088.60 | 24680.60 |
| S&P BSE Sensex | 81463.09 | (-)0.40 | 82315.30 | 80971.60 |
End
Reported by Anshul Choudhary
Edited by Rajeev Pai
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