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Informist, Saturday, Feb. 28, 2026

 

By Anand JC

 

NEW DELHI - The December quarter net profit growth of 186 companies in the Nifty 200 index, for which earnings estimates were available, was much slower than that of the Nifty 50 companies. However, the aggregate revenue growth of these Nifty 200 companies was marginally higher than that of the Nifty 50 companies. The Nifty 200 companies missed bottom line growth estimates by a wide margin, primarily due to one-time costs stemming from the implementation of the new labour codes. However, their revenue growth surpassed estimates by a decent margin.

 

The December quarter net profit growth of these 186 companies improved after excluding one-time items. This is because 140 of these 186 companies reported exceptional items aggregating to a net one-time expense of INR 245.3 billion in the reporting quarter. Of these 186 companies, 137 reported a one-time cost due to the new labour codes, amounting to INR 193.2 billion. Overall, one-time items in the December quarter comprised one-time costs of INR 262.3 billion, including expenses for implementing the new labour codes, whereas one-time gains were only INR 17 billion. In contrast, the same 186 companies had reported a net one-time gain of INR 17.3 billion in the September quarter and INR 183 billion in the year-ago quarter. 

 

The collective net profit of these 186 companies grew only 3% on year for the December quarter, much lower than the expected 10% growth. Excluding all one-time items--costs as well as income--their profit growth improved markedly to 16% on year, which was better than the 13% on-year growth in the September quarter and also higher than the near 12% on-year growth in the year-ago quarter.

 

The revenues of these companies grew almost 10% on year for the December quarter, higher than the expected 7% growth. While the revenue growth in the December quarter was better than the 8% on-year growth in the September quarter, it was significantly below the almost 11% on-year growth booked in the year-ago quarter.

 

The bottom line of all Nifty 200 companies collectively grew only 4.9% on year for the December quarter while their revenue grew 10%. The net profit of 62 companies declined year-on-year in the December quarter, compared with 52 in the September quarter and 56 in the year-ago quarter. The adjusted net profit of 36 firms contracted year-on-year in the December quarter, an improvement from 54 that reported a contraction in profit in the September quarter and 57 in the year-ago quarter.

 

Five companies reported losses in the December quarter, unchanged from the September quarter and marginally higher than four a year ago. Revenue performance of the Nifty 200 companies improved, with only 19 companies reporting a year-on-year decline in the December quarter, compared with 26 in September and 28 in the corresponding quarter a year ago.

 

A cut in the goods and services tax and the resultant rise in consumption benefitted the Nifty 200 companies' bottom line growth for the December quarter. While the GST cut implemented in September benefitted automobile companies significantly, three other sectors reported a strong quarter – rising commodity prices strengthened metal companies' performance, higher gross refining margins increased oil firms' profits, and banks surprised due to lower-than-expected cost of funds.

 

The aggregate profit margin of all the Nifty 200 companies was 11.8% for the December quarter, lower than 15% in the September quarter and 12.6% in the year-ago quarter. The data looks better when one-time items are excluded. The adjusted aggregate profit margin of the Nifty 200 companies for the December quarter was 12.5%, higher than 11.9% in the September quarter and 11.8% in the year-ago quarter.

 

"Profit margins seem to be peaking out for India Inc.," Nuvama Institutional Equities said in its analysis of the December quarter results of BSE 500 companies, excluding oil marketing companies. "The improvement in margin is a function of cost efficiencies of India Inc., restructuring of balance sheets (lower interest expense and credit costs) and better pricing power owing to scrambled-up supply chains. However, profit margins now seem to be peaking," the brokerage said. The brokerage added that margins of corporate India could revert to their mean amid intensifying competition and commissioning of fresh capacities by companies.

 

SUB-INDICES STEAL SHOW

The Nifty Next 50 companies--the 50 large-cap firms that follow the Nifty 50 and together these two sets constitute the Nifty 100--reported a 21% year-on-year growth in net profit for the December quarter. Adjusted for one-time items, their net profit growth improved to 28% on year, which was higher than analysts' projection of 23% growth. These companies' revenue growth was 9.2% on year, nearly double the expected 5.4% growth.

 

The strong performance of the Nifty Next 50 companies lifted the cumulative adjusted net profit growth of Nifty 100 companies. The net profit of the Nifty 100 companies for the December quarter grew only 2.8% on year, lower than the expected 8% growth. However, adjusted for one-time items, their profit growth improved to nearly 15%. These 100 companies' revenue collectively grew 9% on year for the quarter under review, eclipsing the expected 7% growth.

 

The Nifty Midcap 100 companies form the bottom half of the Nifty 200. Their aggregate bottom line grew 4.7% on year, much lower than the expected 21% growth. Adjusted for one-time costs and gains, these companies' net profit swelled almost 28% on year. The revenues of these 100 mid-cap companies surpassed expectations of 9% on-year growth and rose 13% on year.

 

PERFORMANCE DRIVERS

Only companies in the consumer and services sectors managed to beat the aggregate performance of the Nifty 200 companies in terms of net profit, adjusted net profit, and revenue growth. Firms part of the basic industries group beat the Nifty 200 companies on revenue and adjusted net profit growth, but not on net profit growth. Within basic industries, engineering and capital goods companies gained from robust order execution and all-time high order books, according to analysts. The 41 firms that are part of the basic industries group contribute roughly 16% to the revenues of Nifty 200 companies.

 

The bottom line of metal companies such as JSW Steel Ltd. and Tata Steel Ltd. grew multi-fold in the December quarter. Tata Steel's net profit rose sharply in Oct-Dec, as its Netherlands operations turned profitable in the quarter, compared with a loss a year-ago period. JSW Steel's net profit surged after it recognised a deferred tax gain of over INR 14 billion related to its purchase of Bhushan Power and Steel Ltd. through a joint venture.

 

The energy sector—comprising oil and gas as well as power companies—accounts for about 32% of the Nifty 200's total revenue, the highest among all sectors. In the December quarter, these companies' aggregate revenue grew 5% on year, roughly half of the 10% growth of the Nifty 200 companies. Their net profit grew a shade over 22% on year and their adjusted net profit grew almost 20%.

 

Among these 23 energy companies, Indian Oil Corp. and JSW Energy Ltd. reported an over five-fold and a nearly three-fold on-year growth, respectively, in their adjusted bottom line for the December quarter. Indian Oil Corp., Bharat Petroleum Corp. Ltd., and Hindustan Petroleum Corp. Ltd. reported strong gross refining margins amid lower crude oil prices. Oil companies also gained from the government's compensation for under-recoveries on sales of liquefied petroleum gas during 2024–25 (Apr–Mar) and in the first half of the current financial year.

 

As many as 45 financial services firms — including banks and non-banking financial service companies — make up about 19% of the Nifty 200's cumulative revenue. Their collective revenue growth of 13.7% on year outpaced the broader index. Their net profit grew 10% on year, double than that of Nifty 200 companies, whereas their adjusted net profit growth of nearly 15% trailed the wider index by a narrow margin. Profitability of banks in the December quarter improved on higher net interest income, lower slippages, and better recoveries and fee income.

 

Consumer-facing companies, including durables and staples makers, reported a relatively strong quarter. These 19 firms account for about 5% of the total revenue of Nifty 200 companies. Their revenue rose 15% on year, better than top line growth of the Nifty 200. Their net profit grew 34% on year and adjusted net profit grew almost 20% on year – both better than that of Nifty 200 companies. Meanwhile, 12 services companies, which together contribute about 2% to the index group's revenue, posted a sharp 42% year-on-year growth in revenue, a 26% growth in net profit, and a 20% rise in adjusted net profit.

 

At first glance, the 18 transport companies underperformed the broader index on both revenue and profit growth. Their collective revenue rose almost 6% on year, their net profit fell 28%, and their adjusted net profit contracted 3.2%, lagging the index group on all counts. Excluding Tata Motors' passenger vehicle business dramatically alters the picture. The remaining 17 companies posted a 20% year-on-year increase in revenue, while their net profit grew 7% and their adjusted net profit rose almost 25%. Automobile and ancillary firms reported robust revenue growth for the December quarter due to higher product sales during the festival season and an increase in the average selling price of their vehicles.

 

The following is a snapshot of the companies in the Nifty 50, the Nifty Next 50, the Nifty 100, the Nifty Midcap 100, and the Nifty 200 for the December quarter, along with year-on-year and sequential changes, in %, juxtaposed with the consensus estimates from the Informist Poll:

 

Indices	Revenue	Other Income	Total Income	Total Expenses	Material Cost	Employee Expenses	Depreciation	Finance Costs	Other Expenses	PAT	Adj. PAT
NIFTY 50	POLL: 7.76%									POLL: 2.05%	POLL: 2.05%
YoY	9.33	22.72	10.95	13.26	16.39	10.28	9.72	1.86	8.50	-1.35	9.25
QoQ	5.04	0.39	5.93	6.61	7.14	3.57	1.68	0.55	1.83	-26.60	12.65
NIFTY NEXT 50	POLL: 5.41%									POLL: 23.29%	POLL: 23.29%
YoY	9.20	7.82	9.41	8.06	8.55	5.41	-28.10	5.77	-24.35	20.30	27.35
QoQ	6.82	0.29	5.09	4.72	6.98	-5.95	-32.81	-6.97	2.83	6.87	12.75
NIFTY 100	POLL: 6.90%									POLL: 8.08%	POLL: 8.08%
YoY	9.29	18.66	10.37	11.17	13.22	9.31	-1.49	8.15	12.10	4.84	14.50
QoQ	5.67	0.37	5.62	5.86	7.07	1.58	-8.49	2.03	4.63	-18.19	12.68
NIFTY MIDCAP 100	POLL: 8.97%									POLL: 21.04%	POLL: 21.04%
YoY	13.43	9.70	11.92	12.96	12.66	11.05	11.02	2.52	13.46	5.20	26.97
QoQ	6.71	-4.35	5.49	7.42	1.52	2.66	3.22	1.68	3.50	1.23	4.49
NIFTY 200	POLL: 7.28%									POLL: 9.84%	POLL: 9.84%
YoY	10.07	16.75	10.66	11.51	13.10	9.60	0.69	2.96	0.86	4.90	16.31
QoQ	5.87	-0.62	5.59	6.16	5.85	1.76	-6.45	-1.18	2.37	-15.69	11.30

 

The following table shows the net profit margin of companies in the various indices as well as their net profit margin excluding exceptional items:

Profit Margin	Dec. 2025	Dec. 2025 (Adj)	Sept. 2025	Sept. 2025 (Adj)	Dec. 2024	Dec. 2024 (Adj)
Nifty 50	13.15%	13.77%	18.82%	12.84%	14.58%	13.78%
Nifty Next 50	11.33%	11.57%	11.32%	10.96%	10.28%	9.92%
Nifty 100	12.49%	12.97%	16.13%	12.16%	13.02%	12.38%
Nifty Midcap 100	9.48%	10.10%	9.99%	10.31%	10.22%	9.02%
Nifty 200	11.90%	12.41%	14.95%	11.81%	12.49%	11.75%

 

End

 

Data Compiled by Vinod Bhovad

Edited by Tanima Banerjee

 

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