Nifty50 companies have largely beaten sales estimates for the March quarter of the financial year 2021-22 (Q4FY22), however the same is not the case with company profits, a report by Business Standard stated.
As per the report, 28 companies recorded higher than estimated revenue, however, only 19 of the 50 firms made higher-than-expected profits.
The average company recorded 10.8 percent higher sales numbers than expected while the average profit, represented by earnings per share (EPS), was 7.1 percent lower than estimated, it added.
Among stocks, the report noted that Oil and Natural Gas Corporation (ONGC) was among those recording higher revenues than expected, aided by higher crude oil prices meanwhile, State Bank of India also recorded higher growth, amid improving fundamentals.
Similarly, Bajaj Finserv was among those that delivered the largest earnings surprise with an EPS of ₹85, or 88 percent higher than analyst estimates of ₹45, the report pointed out. Further, Grasim Industries also had an EPS of ₹12, which was 119.3 percent higher than analyst estimates of around ₹6, it added.
"The construction and materials sector, of which Grasim is a part, was among those that had the highest positive earnings surprise or where earnings beat estimates. Others in the sector include cement companies as well as construction major Larsen and Toubro. The segment had over 50 percent higher EPS on average than expected," informed the report.
Whereas, financial services companies also beat earnings estimates by over 30 percent. The companies in the segment include Bajaj Finance, Bajaj Finserv, and Housing Development Finance Corporation, it further noted.
However, sectors that did not do as well include healthcare, telecommunications, and industrial goods and services, the report pointed out.
"Healthcare earnings were lower than expected for most companies. Telecommunications saw actual earnings fall 20 percent short of estimates. Industrial goods and services profits were 16.3 percent lower than expectations," it said.
Companies with a larger profit helped the overall Nifty50 EPS register growth, despite the average company in the set taking a hit, it stated. The overall Nifty EPS works out to ₹218.8 for March, or 22.7 percent higher than it was last year, according to the report.
