Capital Goods Stocks Outlook
Q3 earnings likely to drive sector next week
This story was originally published at 21:45 IST on 16 January 2026
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MUMBAI – The capital goods sector is likely to witness stock-specific action next week with some major companies scheduled to report their earnings for the December quarter. Bharat Heavy Electricals Ltd. will report its earnings Monday. Supreme Industries and KEI Industries will report their results Wednesday.
BHEL is expected to more than double its net profit for the December quarter, boosted by operating leverage and a significant rise in margin, according to analysts. The company's revenue is also expected to rise on better execution in its major segments--power and industrial. Its net profit is seen in the range of INR 2.03 billion-INR 4.14 billion, as per estimates from three brokerages. The company had reported a net profit of INR 1.25 billion in the year-ago quarter.
While major companies in the sector are expected to post strong revenue growth, stock prices may face selling pressure because of a slowdown in order wins and high valuations. There is also a possibility that some stocks may rise on the back of optimism around the Union Budget for the financial year 2026-27 (Apr-Mar).
According to estimates from 10 brokerages, the 15 capital goods companies in the Nifty 200 index are expected to report 30% year-on-year rise in cumulative net profit for the December quarter. These companies' cumulative revenue is likely to rise 17% on year.
There is still some concern that the government may limit its capital expenditure as it has to fund the goods and services tax cuts and the tax rebates announced in the Budget for FY26. "The government of India is transitioning toward a greater role as a policy enabler to facilitate private-sector investment while moderating the pace of its own direct capital expenditure push that dominated post-COVID recovery as public infrastructure foundations (e.g., roads, railways) are now more mature," Elara Securities said Wednesday in a strategy report.
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Following are the resistance and support levels for key capital goods 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 | 265.40 | (-)3.20 | 271.80 | 260.70 |
| CG Power and Industrial Solutions | 561.70 | (-)5.60 | 588.90 | 546.60 |
| Larsen & Toubro | 3,856.40 | (-)4.20 | 3,938.30 | 3,807.70 |
| Siemens | 2,919.20 | (-)4.10 | 3,004.10 | 2,860.50 |
| Thermax | 2,970.30 | (-)1.80 | 3,010.10 | 2,900.10 |
| Bharat Electronics | 410.25 | (-)2.00 | 422.20 | 400.40 |
| S&P BSE Capital Goods | 63952.45 | (-)2.50 | 65256.40 | 63099.80 |
| Nifty 50 | 25694.35 | 0.00 | 25954.50 | 25532.30 |
| S&P BSE Sensex | 83570.35 | 0.00 | 84399.10 | 83042.10 |
End
Reported by Anshul Choudhary
Edited by Rajeev Pai
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