Capital Goods Stocks Outlook
L&T earnings to provide cues on W Asia impact
This story was originally published at 22:58 IST on 24 July 2026
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MUMBAI – Stock-specific moves are likely in the capital goods sector next week as several companies are set to announce their quarterly results. Among the major companies, Larsen & Toubro is scheduled to report its June-quarter earnings on Tuesday, which are expected to provide cues on sectoral demand and the impact of the US-Iran conflict in West Asia.
Analysts expect L&T to report a sharp slowdown in earnings growth, with its consolidated net profit likely to rise over 6% on year as compared with nearly 30% net profit growth reported in the June quarter of last year. The consolidated net profit for the latest quarter is seen at INR 38.50 billion, according to the average of estimates from 11 brokerages.
"L&T is likely to report muted execution, particularly in its Middle East businesses, as site progress has slowed amid disruptions arising from the Hormuz crisis. While a majority of sites remain operational, execution has been affected by supply-chain bottlenecks, including delays in movement of equipment and materials, elevated freight and insurance costs, and constraints around logistics and manpower mobilisation," Nuvama Institutional Equities said in a report.
Most analysts expect a hit to profitability due to higher costs, with four analysts predicting a fall in earnings before interest, taxes, depreciation, and amortisation margin of the company to 9.2%-9.7% in the June quarter from 9.9% a year ago.
Apart from exposure to West Asia, domestic capital goods companies are expected to benefit from strong execution, which should help offset some of the impact of higher costs. However, with crude oil futures back near $100, concerns about the impact on companies' margins have pushed stock prices lower from this month's highs. BSE Capital Goods index has fallen nearly 5% this week and may fall more if crude oil prices remain high. At 2121 IST, the Brent crude oil contract for September was at $95.50 per barrel, down 5% from Thursday but still up more than 31% from the pre-war level.
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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 | 417.30 | (-)1.10 | 428.30 | 396.60 |
| CG Power and Industrial Solutions | 867.70 | (-)4.10 | 922.00 | 811.60 |
| Larsen & Toubro | 3785.60 | (-)0.80 | 3855.20 | 3685.20 |
| Siemens | 3689.80 | 0.90 | 3763.70 | 3585.70 |
| Thermax | 4514.00 | (-)3.20 | 4625.00 | 4410.00 |
| Bharat Electronics | 405.00 | (-)1.10 | 409.10 | 398.90 |
| Index | Levels | |||
| S&P BSE Capital Goods | 77369.24 | (-)1.00 | 78170.40 | 76452.60 |
| Nifty 50 | 23767.45 | (-)2.30 | 23949.80 | 23515.20 |
| S&P BSE Sensex | 76059.77 | (-)2.70 | 76651.60 | 75178.50 |
End
US$1 = INR 96.56
Reported by Anshul Choudhary
Edited by Saji George Titus
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