Nifty Corporate Earnings Analysis –

Q4 | 2016

 

by Rajat Sharma | May 12, 2016

Yesterday we analyzed earnings trend for constituent companies of the S&P CNX Nifty. On year-on-year basis (Q4 2015 to Q4 2016) corporate earnings showed a growth of 14.7%. In comparison, average stock prices went down by 1.9% during the same period*.

* Based on stock prices as on 31st March for each year.
** Based on 26 of the 50 companies comprising the S&P CNX Nifty that have declared results as of the date of this article.

 

Current PE Valuation of the Nifty = 21.30

corporate earnings

Excel Calculation – 26 Nifty Company Result

Key Points about Corporate Earnings for Q4:

  • The analysis is based on the results of 26 out of 50 Nifty companies which have declared earnings so far.
  • Note – from April 1, 2016, Nifty has excluded Cairn, Vedanta, and PNB and included Aurobindo Pharma, Bharti Infratel, and Eicher Motors
  • Earnings are improving while stock prices are showing a declining trend.
  • On year-on-year basis there is an average growth of 14.7% in profitability. The benchmark Nifty went down 9 % in the same period.
  • On a trailing basis markets remain expensive and are trading at valuations of 21.30 (PE).
  • Most sectors have shown considerable improvement in profitability.
  • Fundamentally (besides valuations) things are looking good at macro level.
  • Pharma, Metals, Construction, Oil and Gas , Power companies are yet to announce their earnings for Q4 of FY 2016. 

 

WE WILL BE UPDATING THIS ARTICLE ONCE REST OF THE COMPANIES DECLARE THEIR RESULTS OVER THE NEXT 1 MONTH. 

BOOKMARK THIS SPACE.

 

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