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Informist, Wednesday, Oct. 7, 2026

MUMBAI – Taking major benefit from strong volume, price hikes, and a favourable mix showcased by automobiles and components companies, Kotak Institutional Equities sees companies under its coverage posting an aggregate on-year growth of 21% in net sales during the September quarter. Besides automobiles and components players, banks, diversified financials, metals and mining, oil, gas, and consumable fuels, and telecommunication services were also considered as major sectors driving the estimated net sales growth. Kotak Institutional Equities also sees a 21% on-year growth in aggregate net profit of the Nifty 50 companies.

The brokerage expects banks to aid the robust net sales growth estimated for the quarter as the sector witnessed a stable quarter with low credit costs and a low base for select private banks. With elevated commodity prices, metals and mining companies are also likely to contribute significantly to the aggregate top line growth of companies under Kotak's coverage.

Strong earnings posted by the oil-to-chemical segment of Reliance Industries and higher upstream crude realisations are expected to aid oil, gas, and consumable fuel companies to play a pivotal role in the revenue growth, according to the brokerage report. Telecommunications sector, with its subscriber addition-led average revenue per user, also contributed its fair share to the aggregate revenue growth.

However, Kotak sees companies in commodity chemicals, consumer staples, fertilisers and agricultural chemicals, and pharmaceuticals to report weak earnings in the September quarter. The brokerage estimates Nifty 50 earnings growth for 2026–27(Apr-Mar) at 17.9% and that for FY28 at 13.4%. Its earnings-per-share for the 50-member index was estimated at INR 1,227 for FY27 and at INR 1,398 for FY28.

The broking firm views the original equipment manufacturers' revenue to increase by 29% on year mainly on account of an over 20% increase in production volumes due to strong retail momentum. Low single-digit improvement in average selling price due to price hikes, a favourable mix in passenger vehicles and two-wheeler segments are also expected to lead to a revenue rise in this sector.

For banks, Kotak sees the September quarter to be stable on expectations of 11% on-year earnings growth. "We expect NII (net interest income) to grow 11% yoy (year-on-year) and non-interest income to decline due to lower treasury income," the brokerage said. It also expects private banks to report 20% earnings growth on year. Meanwhile, public sector banks are likely to report a flat on-year earnings decline, factoring in the recent disclosures from Bank of Baroda.

"We expect NIM (net interest margin) to be stable or marginally lower qoq (quarter-on-quarter), depending on the quantum of deposits raised through FCNR deposits, while lending yields have been stable for the quarter," it said in the report.  End

Reported by Arundathi A R

Edited by Deepshikha Bhardwaj

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