India Inc. could possibly be in the course of its worst quarter by way of earnings, mentioned Manishi Raychaudhuri, chief government officer of Emmer Capital, as muted early outcomes proceed to trickle in for the March quarter.
“This quarter would be the worst within the cycle,” Raychaudhuri instructed Newsstate24 Revenue. “From the primary quarter of monetary 12 months 2026, we count on issues to enhance as authorities infrastructure spending and rural money transfers start to movement in.”
The March-quarter earnings season has thus far seen cautious commentary from bellwether firms throughout expertise, client, and industrial sectors. Analysts have flagged dangers of margin stress, subdued consumption, and delayed funding choices because of the ongoing political and financial cycles.
Raychaudhuri additionally famous that client discretionary restoration could take about two quarters because the affect of tax advantages and infrastructure spending begins to materialise.
Regardless of the present softness, India’s long-term fundamentals stay intact, attributing the slowdown to short-term components tied to the geopolitical and financial calendar relatively than any deep structural points, Raychaudhuri emphasised.
Manishi Raychaudhuri, CEO of Emmer Capital Companions (Picture supply: @Manishi_R through X)
Valuation Premium Could Want To Cool Additional
On the subject of valuations, Raychaudhuri highlighted that whereas Indian valuations have been “fairly enticing” in early March—relative to their Asian friends—they’ve since rebounded.
Indian shares are presently buying and selling at a 55-60% premium to MSCI Asia ex-Japan, which is properly above the long-term common premium of 40-42%. He expects this premium to reasonable additional, which may current a extra enticing entry level for traders.
Raychaudhuri burdened {that a} slight pullback of 8-10% in Indian markets, or a state of affairs the place different markets in Asia, notably North Asia, see a big rebound, may assist slender this valuation hole.
Medium-Time period Buys
Raychaudhuri singled out three sectors for medium-term funding alternatives. Financials, particularly non-public sector banks, stay a robust focus, alongside industrials, which may benefit from the continuation of infrastructure spending and rising defence budgets globally, he mentioned.
This is also a chance for India, given the rising geopolitical tensions, he added.
The third sector he highlighted was client discretionary. “There’s extra cash being thrown on the shoppers,” Raychaudhuri famous, citing tax rebates that make as much as Rs 12 lakh of revenue tax-free in India. He expects this to enhance client sentiment, notably for discretionary merchandise, even because the demand for staples stays subdued.
There’s potential for higher sentiment in sectors like client discretionary items, on account of this fiscal assist, in keeping with him. Nevertheless, world demand, notably for supplies, would should be monitored, particularly with ongoing bilateral commerce negotiations and broader world market circumstances, he added.
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