Capital Goods Stocks Outlook
Seen in range on uncertainty over US-Iran deal
This story was originally published at 22:02 IST on 22 May 2026
Register to read our real-time news.Informist, Friday, May 22, 2026
MUMBAI – Shares of capital goods companies are likely to move in a range next week amid uncertainty around the US-Iran deal to end the war. While high valuations are likely to limit upside, the prospect of strong future growth may continue to push investors to buy these stocks, analysts said.
"Several defence stocks now trade at price-to-earnings multiples north of 80-100x on the back of order book-driven earnings projections that extend three to five years into the future. Data center plays have been accorded valuations that imply an almost frictionless execution of extremely ambitious capacity expansion plans. The market is not merely pricing in optimism — it is pricing in perfection," Amit Kumar Gupta, founder of Fintrekk Capital, said in a post on LinkedIn.
Capital goods companies have largely outperformed expectations during the March quarter. Cumulative net profit of the 12 capital goods companies in the Nifty 200 index that have reported Jan-Mar earnings so far rose 14.6% on year after excluding exceptional items. This is better than the 12.5% growth expected for these companies, according to an Informist poll. The 12 companies' sales rose nearly 19% on year, better than expectations of 16.7%.
While analysts raised concerns about margin risks due to higher costs on account of the surge in crude oil prices since the US-Iran war started, they are also confident that earnings growth will remain strong in the long run. "Sustained government spending, steady capacity expansion in power, mining, oil and gas, metal and auto-linked sectors, and increasing opportunities from emerging segments such as data centres and electric vehicle infrastructure will ensure a revenue growth of 12-14% for the capital goods industry this fiscal, similar to last fiscal," Crisil said in a report on Friday.
Shares of the BSE Capital Goods index gained nearly 2% this week after falling more than 2% in the previous week. Shares of Honeywell Automation India, Siemens Energy India, and GE Vernova T&D India were the top gainers in the sector this week, rising 12-22%. Shares of Jyoti CNC Automation, PTC Industries, and Carborundum Universal lost 4-6% this week.
TOP HEADLINES
* Suzlon Energy gets 195-MW order for 65 wind turbine generators
* Transformers and Rectifiers gets order worth INR 2.28 bln
* Ashoka Buildcon Q4 PAT, sales fall on year, below view
* Engineers India Jan-Mar net profit falls 37.5% YoY, sales down over 9%
* Reliance Power says adjudicating body attaches INR 4.08 bln-assets under PMLA
* Power Mech Projects Q4 consol PAT jumps over 21% YoY, sales up 14%
* Analyst Concall: Samvardhana Motherson sees significant headroom for M&As
* Action Construction Jan-Mar consol PAT falls 6.5% YoY to INR 1.11 billion
* Earnings Review:Samvardhana Motherson Q4 PAT, revenue comfortably above view
* ICRA places Tega Ind's bank facilities on watch with developing implications
* RITES Jan-Mar PAT rises 1.4% YoY to INR 1.36 billion
* Transformers and Rectifiers gets order worth INR 1.75 bln
* Timken India Jan-Mar net profit falls 17% on year, sales up over 14%
* Varroc Engg board to meet May 27 to consider issuing NCDs
* Electrosteel Castings Q4 consol PAT falls over 90% YoY as sales fall 12%
* Tega Ind gets INR 15-bln loan from bks, invests $5 mln in arm to buy Molycop
* SC admits excise dept plea against Electrosteel Castings on duty non-payment
* Earnings Review: KEC Intl Q4 consol PAT falls over 28% YoY, most in 12 qtrs
* Texmaco Rail gets 2 letters of acceptance from Railway for INR 1.92 bln
* Crisil downgrades long-term rating on Tega Industries to 'A+' from 'AA-'
The 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 | 408.55 | 2.60 | 416.20 | 403.30 |
| CG Power and Industrial Solutions | 865.70 | 3.30 | 881.20 | 850.20 |
| Larsen & Toubro | 3,926.60 | 0.50 | 3,988.80 | 3,869.00 |
| Siemens | 3,811.70 | 6.20 | 3,906.60 | 3,666.60 |
| Thermax | 4,454.60 | (-)1.00 | 4,718.50 | 4,289.70 |
| Bharat Electronics | 416.55 | (-)1.70 | 423.80 | 411.80 |
| Index | Levels | |||
| S&P BSE Capital Goods | 78316.91 | 1.90 | 78809.60 | 77936.20 |
| Nifty 50 | 23719.30 | 0.30 | 23906.60 | 23577.30 |
| S&P BSE Sensex | 75415.35 | 0.20 | 76065.90 | 74905.50 |
End
Reported by Anshul Choudhary
Edited by Saji George Titus
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd. by NSE Data & Analytics Ltd., a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt. Ltd.
Informist Media Tel +91 (22) 6985-4000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2026. All rights reserved.
To read more please subscribe
Share this Story:
